Mortgage Rate Update June 20, 2011

Mortgage rates are unchanged today.

This week attention will be focused on the Fed and the ongoing debt saga in Europe.  The Fed’s regularly scheduled 2-day monetary policy meeting begins tomorrow and will conclude Wednesday when we’ll get the post-monetary policy statement & press conference.

It is widely expected that the Fed will leave short-term interest rates unchanged but what analysts will be listening for is a mention of any possibility for a 3rd round of quantitative easing since the economic outlook has deteriorated over the past few weeks.

In Europe, finance officials from many of the EU nations met over the weekend to try and come to agreement on how to relieve Greece of its ongoing debt problems.  Unfortunately there is still disagreement on who should bear the burden of bailing the Greek government out so uncertainty reigns.

As long as the economic outlook remains dim and uncertainty surrounds the Greek debt crisis mortgage rates here in the US should remain low thanks to investors seeking safety.  I will maintain a neutral position as I don’t see any catalyst for rates to move lower or higher at this point.

Current Outlook:  neutral