Mortgage rates are unchanged this morning.
The Fed begins their 2-day monetary policy meeting today which concludes tomorrow with the much anticipated monetary policy announcement.
Most analysts believe that the Fed will announce a program being called “operation twist” which involves the Fed trading out shorter duration treasury securities in exchange for longer-duration securities. Mortgage rates have decreased in anticipation of this program. Should the Fed fail to act on speculation I would expect rates to move higher.
The European Central Bank intervened in the market overnight to support Italian Government debt after Standard & Poor’s downgraded their credit rating. European finance officials are still scrambling to fix Europe’s debt problems but still no credible solution.
This morning’s housing data was a mixed bag. Although new housing starts were reported below expectations, new building permits were slightly higher than expectations. The markets have largely ignored the news.
Current Outlook: locking bias