Mortgage Rate Update April 9, 2015

Mortgage rates are unchanged for the week.

Minutes from the last Federal Reserve monetary policy meeting were released yesterday and the markets had little response.  If you’ll remember this past meeting was much anticipated because investors were waiting to hear if they’d drop “patient” from the post-meeting statement.  The minutes showed that there was consensus around this detail but there is still disagreement about how soon to begin raising short-term rates.

The markets now believe there is a 6% chance the Fed will begin raising short-term rates in June, a 16% chance in July, a 35% chance in September, and 53% chance in October.  As we know the Fed does not directly control mortgage rates.

Mortgage rates have been more or less unchanged for the past 7 trading days.  From a technical perspective there is no clear indication on which direction the markets are headed.

This afternoon’s US Treasury auction of 30-year bonds could set the tone headed into next week (Click HERE to learn how government bond auctions can impact mortgage rates).  Yesterday’s 10-year note auction was met with solid demand from investors.  IF that pattern continues today it would bode well for mortgage rates.  If not, watch out.

Current Outlook: neutral