After improving in the two prior weeks, mortgage markets finished last week unchanged overall.
Mortgage rates were down early in the week but managed to give up all of their gains late-Friday afternoon. It’s the same volatility variety we’ve seen in most weeks this year.
Markets moved on to both positive- and negative-type news last week. On the positive side:
- Fed Chairman Ben Bernanke said the recession is “very likely over“
- Retail Sales were much stronger than expected
- Warren Buffett confirmed to CNBC that he was back in the market
On the negative side, Housing Starts idled and corporate earnings fell flat.
This week, the market moves on.
Investors will watch several key releases including Existing Home Sales on Thursday, and Consumer Sentiment and New Homes Sales on Friday. The most important event of the week by far, however, is the scheduled, 2-day meeting of the Federal Open Market Committee.
The FOMC is the policy-setting group of the Federal Reserve and each time it meets, markets have a tendency to get volatile.
Markets expect the FOMC to leave the Fed Funds Rate within its current “target range” of 0.000-0.250 percent but that doesn’t mean mortgage rates will remain unchanged as well. Depending on the verbiage of the FOMC’s post-meeting press release, mortgage rates could rise or fall by a lot.
The FOMC adjourns from its 2-day meeting Wednesday at 2:15 PM.
(Image courtesy: Wikipedia, licensed under Creative Commons)