Mortgage rates continue to move lower
“Give a man a fish and he eats for a day. Teach a man to fish and he will neglect his job and family thereafter.”- anonymous
Today is National Go Fishing Day! As anglers take to the waterways mortgage rates are sinking!
Mortgage rates continue to trend lower prompting many homeowners to evaluate their refinance options. The Mortgage Bankers Association reported that refinance applications jumped 47% last week compared to the prior week.
European Interest Rates
Yields in the US are following European interest rates lower. Concerned with declining economic growth European Central Bank President Mario Draghi stated earlier today that he is prepared to cut short-term interest rates and accelerate bond-buying programs with the hopes of driving interest rates down.
The yield on a German 10-year bund is currently negative .30%. Comparatively the yield on a US 10-year treasury note is trading at ~+2.06%.
The US central bank begins their regularly scheduled two-day monetary policy meeting today. Tomorrow they will announce any changes to US short-term interest rates. I don’t expect they will cut rates tomorrow but their comments could help mortgage rates improve further.
The Week Ahead
The weekly economic calendar is relatively light. The highlights include the aforementioned Fed announcement (Wednesday) and Existing Home Sales (Friday).
Momentum is on our side which is why I shifted to a floating bias last week. I will maintain that position.
Current Outlook: floating bias