Bonds were volatile, driven by the stock market's gyrations.
On 4 consecutive days, the Dow Jones Industrial Average moved by more than 400 points. Rate shoppers in Georgia had no choice but to go along for the ride.
The week began with the market's reaction to Standard & Poor's U.S. credit rating downgrade. Mortgage bonds caught a boost on the news, and pushing rates lower throughout the day.
Tuesday, rates idled ahead of the Federal Open Market Committee meeting. There was speculation that the Federal Reserve would introduce a new round of economic stimulus but that didn't happen. Instead, the Fed pledged to keep the Fed Funds Rate in its current range near zero percent until mid-2013, at least.
Mortgage rates dropped on the announcement and continued to drop until they fell to their lowest levels of the year -- and of all-time -- late Wednesday afternoon.
This proved to be the lowest rates of the week.
Thursday and Friday were marked by better-than-expected jobless figures and an improving Retail Sales number. Mortgage rates rose slightly.
This week, mortgage rates should be equally as volatile.
In addition to new bailout talks within the Eurozone, there is a bevy of economic data due for release in the U.S., as well as a full Fed speaker docket:
- Monday : Homebuilder Confidence Survey; Fed President Lockhart speaks
- Tuesday : Housing Starts; Building Permits
- Wednesday : Producer Price Index; Fed President Fisher speaks
- Thursday : Existing Home Sales; Fed President Dudley speaks
- Friday : Fed President Pianalto speaks
Mortgage rates have been trending lower in recent weeks and there are few reasons to think that trend will reverse. However, mortgage markets can be wildly unpredictable -- especially when acted upon by an outside force such as the Federal Reserve or the U.S. government.
Stimulus and rheotoric can change mortgage rates in a hurry.
Therefore, if you see today's rates and they fit within your budget, consider locking something in. Once rates start to rise, they're going to rise quickly.
