This last week, incoming Federal Reserve Chairwoman Janet Yellen, was on Capitol Hill for her confirmation hearing, as Fed Chairman Ben Bernanke is stepping down at the end of January. Her statements signaled that the Fed’s current Bond purchase program will continue, as the economy is still running below the Feds goals. This should be good news for San Diego Mortgage Rates.
Remember, the Fed has been purchasing $85 billion in Bonds and Treasuries every month to try and stimulate the economy and housing market. This $85 billion includes Mortgage Bonds, to which interest rates are tied.
In economic news, the Weekly Initial Jobless Claims are still hovering near the 340,000 mark while the Empire State Manufacturing Index came in weaker than expected. The Empire State Manufacturing Index also revealed that labor market conditions are weakening, with the index falling four points.
This report confirms Janet Yellen’s statement in her prepared text to congress at her confirmation hearing that, “Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential.”
How does this affect San Diego Mortgage Rates?
The Fed has noted that the decision regarding when to start to decrease its Bond purchases will be dependent on economic data. In the coming weeks, it will be important to closely watch the economic reports, as they will help determine whether the Fed starts to decrease its purchases later this year or in 2014. This decision will have a large impact on San Diego Mortgage Rates leading into 2014.
Now remains a great time to consider a home purchase or refinance as rates for San Diego home loans still are attractive and the new QM (Qualified Mortgage) guidelines start in January. If you are interested in getting a San Diego Mortgage Rate quote, please click HERE or feel free to give me a call at 619-312-0612.
I just locked in a 15 year fixed on a HARP 2.0 refinance at 3.5% on a condo. The loan amount is $201,000 and the loan to value was 88% with no mortgage insurance. The APR is 3.659% and the client is paying about the same as they did on their current 30 year fixed.
What Could Affect Mortgage Rates This Week?
One of the biggest potential rate movers, will be the minutes from the Fed’s October meeting of the Federal Open Market Committee, which will be reported on Wednesday. It will be important to note if the minutes reveal any news about the Fed decreasing its Bond purchase program.
The week before Thanksgiving offers a cornucopia of economic data that covers a broad range of the U.S. economy.
Monday starts off with housing news from the National Association of Home Builders Housing Market Index, followed by Existing Home Sales on Wednesday.
Consumers’ attitudes toward spending will be revealed in the Retail Sales report on Wednesday.
Inflation data from the Consumer Price Index and the Producer Price Index will be released on Wednesday and Thursday.
Weekly Initial Jobless Claims will be reported as usual on Thursday.
Also on Thursday, will be manufacturing data from the Philadelphia Fed Index.
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