Mortgage rates moved lower as we begin the week, following an echo from the Fed's announcement of further quantitative easing last week. Last week, rates were holding steadily calm at best execution levels of 3.5% to 3.625%. This week, we are seeing best execution levels hovering between 3.375% to 3.25% in some instances. The latest Fed meeting revealed a strong level of commitment toward additional monetary accommodation in the near future focused primarily on the long-end of the yield curve, which has a direct impact on the mortgage market and longer term mortgage products such as the 30-Year fixed.
With continued issues in Europe's economy and their common currency, the flight to safety is pushing the US treasury market to lower yields and higher costs. We anticipate rates to remain within this current range, and not much lower movement for the short to medium term. We would recommend locking a rate in rather than gamble, especially since volatility remains fairly high with the uncertainty currently swirling in the day-to-day financial markets.
Long Term Guidance: We advocate against trying to predict how low rates will go due to market uncertainty. The long-term direction of rates has undoubtedly been down....down....and down for the past year. But at some point, things may change. And you simply dont want to be caught in the middle when that happens.