Mortgage Rate Update January 24, 2012
Mortgage rates are unchanged this morning.
Starting in Europe, talks between Greek finance officials and private creditors have reportedly stalled. Greece needs private creditors to accept deep cuts in order to qualify for another round of bailout relief and has yet to gain concessions. Meanwhile, the International Monetary Fund is renewing warnings that if European leaders are unable to put in place policies to curb contagion that they foresee a severe recession lasting multiple years. Although this level of uncertainty is scary on many levels it does help keep US mortgage rates low through the process call “flight-to-safety”.
Here in the US the Treasury kicks off its first of three auctions this week with $35 billion in 2-year notes. It is widely expected that the sale will be met with sufficient demand which should help rates remain low.
The President will deliver the annual State of the Union address later tonight. He is expected to speak about the economic fairness and energy production. Its unlikely this will impact the markets since this is an election year.
Tomorrow the Federal Open Market Committee will convene a 2-day monetary policy meeting. At this point the market is not expecting any change to monetary policy so the only factor that could impact rates are comments regarding the outlook on the economy.
Current Outlook: neutral