Mortgage Rate Update June 22, 2011

Posted on by Evan in Rate Update

Mortgage rates are priced slightly better this morning.

Late yesterday Greece’s Prime Minister George Papandreou barely survived a no-confidence vote by Parliament.  The tight margin on the vote showed investors that he may have a difficult time pushing through highly unpopular austerity cuts which are required for Greece to avoid default next month.

Now Greece's Parliament will have to pass more spending cuts

If Greece defaults on its debt the IMF has warned about the spillover effects around the globe.  The uncertainty surrounding the Greece debt crisis has helped keep mortgage rates low here in the US for almost a year.

The Fed will wrap up it’s regularly scheduled 2-day monetary policy meeting today which will conclude with the policy statement & press conference.  It is expected that the Fed will restate the belief that the current economic slowdown is “transitory” (AKA temporary), that they will let QE2 end with no plans for any further quantitative easing, and that they will leave short-term interest rates near 0% for an extended period.  Any deviation from these expectations could drive the markets out of the current range.

Current Outlook:  neutral