While the statement that closed the January 31-February 1 meeting acknowledged that inflation has begun to retreat -- "Inflation has eased over the past year but remains elevated," said the release - Fed Chair Powell added greater color to this perception in his post-meeting press conference. "We're looking for greater confidence that inflation is moving sustainably down to 2 percent," he noted, adding "It's not that we're looking for better data. We're looking at continuation of the good data that we've been seeing." He also said that "The lower inflation readings over the second half of last year are welcome, but we will need to see continuing evidence to build confidence that inflation is moving down sustainably toward our goal."
Applications for mortgage credit declined by 7.2% in the week ending January 26, ending what was a fair month for mortgage activity on a downbeat note. Requests for funds to purchase homes slumped by 11.4%, but those to refinance existing loans managed a 1.6% increase for the week. Mortgage rates have mostly leveled off over the last two months, with the average offered rate for a 30-year FRM holding between 6.6% and 6.7% over the last seven weeks.
Based purely on where the yield on the influential 10-year Treasury ended Friday -- that is, back to about where it was before the Fed meeting -- it looks as though that mortgage rates may have just a little space to retreat this week. Compared to last week, the economic data calendar is sparse, giving investors some time to ponder the present and future of the economy and path of monetary policy. We think that the average rate for a conforming 30-year FRM as reported by Freddie Mac will retreat by perhaps three basis points by Thursday. Should this decline come, it would put the most popular mortgage rate back at about nine-month lows, not a bad start for the upcoming spring homebuying season.
Applications for mortgage credit declined by 7.2% in the week ending January 26, ending what was a fair month for mortgage activity on a downbeat note. Requests for funds to purchase homes slumped by 11.4%, but those to refinance existing loans managed a 1.6% increase for the week. Mortgage rates have mostly leveled off over the last two months, with the average offered rate for a 30-year FRM holding between 6.6% and 6.7% over the last seven weeks.
Based purely on where the yield on the influential 10-year Treasury ended Friday -- that is, back to about where it was before the Fed meeting -- it looks as though that mortgage rates may have just a little space to retreat this week. Compared to last week, the economic data calendar is sparse, giving investors some time to ponder the present and future of the economy and path of monetary policy. We think that the average rate for a conforming 30-year FRM as reported by Freddie Mac will retreat by perhaps three basis points by Thursday. Should this decline come, it would put the most popular mortgage rate back at about nine-month lows, not a bad start for the upcoming spring homebuying season.
