Mortgage rates are slightly better following the Fed’s post monetary policy meeting comments yesterday.
Despite recent data which suggests that inflationary pressure is building in the US Fed Chairwoman Janet Yellen reiterated yesterday that the Fed plans to keep short-term interest rates low for an extended period of time. Inflation is the primary driver of long-term interest rates because it erodes future purchasing power.
For those holding credit card and home equity lines of credit, the Fed expects to raise the Federal Funds rate by ~1.00-1.25% by the end of 2015. Mortgage rates reacted positively to the announcement because some analysts had thought the Fed may need to act more aggressively.
There are no more economic data points set for release this week so mortgage rates will react to technical trading patterns and geopolitical events. Mortgage rates will likely find it difficult to push through technical resistance so locking now is not a bad play.
Current Outlook: locking