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Mortgage Rates Quietly Thunder to 1-Year Lows

Mortgage rates fell more triumphantly today, extending their reaction to yesterday’s Federal Reserve announcement.   The Fed isn’t in direct control of interest rates, although the opposite often seems to be true.  The free market largely decides rates due to factors like growth, inflation, and supply/demand of bonds.  That said, the Fed plays a big role in helping/hindering the natural economic currents.  They adjust accordingly to try to keep the economy firing on all cylinders without inflation overheating and without big financial stability risks.
Yesterday’s adjustment was fairly big and somewhat unexpected.  Some of the market reaction may be due to the economic implications of the Fed’s apparent concern.  In other words, it could be seen as wake-up call about the economic risks underpinning the Fed’s logic (and economic risks = lower rates, in general).  But the fact that stocks have also improved today suggests markets are simply continuing to bask in the warm glow of a surprisingly friendly refocusing of the lens through which the Fed views the economy….(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.
Source: mortgagenewsdaily.comNew feed

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