Interest rates for 30- and 15-year fixed home loans, as well as 5/1 ARMs, all slipped lower today, according to a NerdWallet survey of mortgage rates published by national lenders Wednesday morning.
The bond market — and, as a result, mortgage rates — is reacting to a just-released Commerce Department report of weak retail sales in May.
The Federal Reserve is expected to raise short-term interest rates by a quarter of a percentage point today. With recent economic reports showing some mixed results — and slowing inflation — analysts will be particularly interested in the Fed’s outlook for monetary policy through the end of the year.
Many economists have been anticipating one more interest rate increase from the Fed before the end of 2017 and will be looking for confirmation of that strategy.
The Fed has also expressed an interest in reducing its portfolio of Treasurys and mortgage-backed securities. These bundles of bonds were purchased by the Fed following the housing crisis in an effort to prop up the economy. Now the central bank is considering how best to ease out of the holdings, without shocking mortgage rates. That will take gradually selling the MBS holdings, so that prices, and resulting yields, aren’t significantly affected.
In the meantime, the shooting of Republican Congressman Steve Scalise and others at a ballpark in Virginia early Wednesday may unnerve markets.
MORTGAGE RATES TODAY, WEDNESDAY, JUNE 14:
NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.
Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: email@example.com. Twitter: @halmbundrick.