The 30-year fixed-rate mortgage was unchanged, the 15-year fixed fell two basis points, and the 5/1 ARM was also unchanged, according to a NerdWallet survey of daily mortgage rates published by national lenders Wednesday.
The 30-year fixed is down eight basis points from a week ago and is 33 basis points higher than a year ago.
Mortgage rates were relatively stable as the Federal Reserve announced Wednesday that it will keep the overnight federal funds rate unchanged, in a range of 1% to 1.25%. The announcement came at the end of the central bank’s regularly scheduled monetary policy meeting.
The federal funds rate doesn’t directly affect mortgage rates. Instead, mortgage rates are influenced more by the overall economic climate, including inflation. Low inflation kept the Fed from raising short-term rates this time around, and it’s keeping a lid on mortgage rates, too.
The Fed has a target inflation rate of 2%. But the Fed’s favorite inflation measure, the core personal consumption expenditures price index, was up only 1.3% in September compared with the previous September.
The central bank said it expects inflation to reach 2% “over the medium term.”
Investors in the futures markets had predicted that the Fed would keep short-term rates unchanged following today’s meeting. But investors believe the central bank will hike the federal funds rate at the next meeting, which concludes Dec. 13. As of Wednesday afternoon, the futures market had priced in a better-than-95% probability that the Fed will hike the federal funds rate by a quarter of a percentage point following the December meeting.
MORTGAGE RATES TODAY, WEDNESDAY, NOV. 1:
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.