Rate Update December 6, 2010
Mortgage rates are priced slightly better today.
In his appearance on ’60 minutes’ yesterday evening Fed Chairman Ben Bernanke managed to convince the markets, at least temporarily, that inflationary worries over the Fed’s QE2 policy are overblown. In the interview Chairman Bernanke reminded the audience that the Fed could, “raise interest rates in 15 minutes if we have to.”
Since increased inflation expectations were partly to blame for higher rates during the past few weeks we’re seeing rates improve modestly this morning. In addition, I don’t think I can emphasize enough the impact of the weaker-than-expected jobs report.
It’s a relatively light week in terms of new economic data so we’ll be watching for news out of Europe and the stock market. The US Treasury is back on the auction block this week with $66 billion in new supply. Click HERE to understand how government borrowing impacts mortgage rates.
For now I will recommend a floating position.
Current outlook: floating