What’s Ahead For Dublin CA Mortgage Rates This Week : June 27, 2011

What’s Ahead For Dublin CA Mortgage Rates This Week : June 27, 2011

Fed Funds RateMortgage markets improved again last week on a revised economic outlook for the U.S. economy, and ongoing concerns about Greece and its sovereign debt.

Conforming and FHA mortgage rates in Dublin and across California fell last week and now hover near the all-time lows set last November. Did you miss the refinance opportunity of last year?

News to Watch

There were three big stories last week that will carry forward into this week.

First, the Federal Open Market Committee voted to leave the Fed Funds Rate unchanged in its current target range of 0.000-0.250 percent. This was expected. However, the Fed revised its growth estimates for the U.S. economy lower. This was not expected.

Dublin CA and Bay Area mortgage rates dipped on the news.

Second, Greece moved closer to avoiding insolvency. The nation-state’s parliament must now pass a package of spending cuts and tax increases to appease Eurozone leaders and the IMF. Without passage, though, bankruptcy may be unavoidable.

Worries about Greece’s fate sparked a bond market flight-to-quality. This, too, helped mortgage rates ease. Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

And, lastly, Thursday, the U.S. and other members of the International Energy Agency chose to release 60 million barrels of oil to the market over the next month. You’ve likely experienced the impact as the gas pump already — gas prices are way down nationwide.

Lower gas prices means fewer inflationary pressures and inflation is the enemy of mortgage rates. Less inflation, lower mortgage rates.

The Week Ahead

This week, mortgage rates may reverse.

There isn’t much new data due for release — inflation data due Monday, housing data due Wednesday, and a series of confidence reports throughout the week — but there are 3 scheduled treasury auctions that could pull rates up or down.

  • Monday : 2-Year Treasury Note auction
  • Tuesday : 5-Year Treasury Note auction
  • Wednesday : 7-Year Treasury Note auction

The Treasury Department will auction off a total of $99 Billion in 2-, 5- and 7-Year Notes on Monday, Tuesday, and Wednesday. I will watch those auctions closely to see how they’re received and how they impact home loan rates early in the week. If demand is high at any/all of the auctions, mortgage rates should drop. If demand is weak, mortgage rates should rise.

I Love to Work With My Readers

The good news is that home loan rates are still at historical lows, making this a terrific time if you or someone you know might be thinking about refinancing or purchaing a home. It only takes a few minutes to see if you can benefit from the situation. Call or email me personally to get started.



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