Mortgage Rate Update May 16, 2012
Mortgage note rates remain at all-time low levels.
Greek officials have set the date of June 17thfor the next round of elections. The polls suggest that political parties that oppose EU sanctioned austerity measures will gain ground increasing the likelihood of an exit from the European Union. Judging by the amount of money withdrawn from Greek banks on Monday the polls are right.
Depositors withdrew €700 million from Greek banks leaving the financial system even more vulnerable.
Here at home US economic data was mostly mixed. The Commerce Department reported that home construction increased in April. On a year-over-year basis housing starts are up 30%. However, the number of housing permits drawn, a sign of future construction, fell by 7% in April. Later today the minutes from the last Federal Open Market Committee meeting will be released. We don’t expect any mention of further quantitative easing.
Europe continues to be the main driver for US mortgage rates. Greater uncertainty & fear should cause mortgage rates to improve and vice versa. I think locking in is not a bad plan at this point.
Current Outlook: locking bias