Mortgage rates remain at multi-month lows this morning.
The longer that rates remain at the current levels I can’t help but think we’re living on borrowed time.
After mortgage rates increased by ~1.00% in 2013 virtually all the forecasts I read for 2014 called for rates to continue to march higher. However, here we are in the middle of May and rates are lower today than they were back on January 2nd.
The economic calendar is relatively light this week. The most interesting economic event this week will likely come on Wednesday when minutes from the last Fed meeting are released. The Fed, along with other Central Bankers around the globe, have been careful to sound “dovish” in recent appearances which has helped rates move lower. The minutes may reveal that as a whole the committee is less accommodative than their public comments would lead on. If so, rates would bounce higher.
Aside from the Fed minutes I expect interest rates to take direction from stocks. In general, the financial markets seem to be cautious with regard to equity valuations. Should the stock market decline it would help rates remain at these low levels.
For now, I will take a floating position but don’t be surprised if I shift this outlook later in the week.
Current Outlook: floating