Today, the Federal Reserve Open Market Committee wrapped a two day meeting with a policy statement, interest rate decision, and a press conference.
As for policy and rates, the Fed maintained the status quo:
“…the Committee decided today to continue its program to extend the average maturity of its holdings of securities [And] its existing policies of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities…”
“keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.”
So there’s that. Both the economic environment and the policy stance continue to be low-mortgage-rate friendly.
At the press conference itself, Mr Bernanke gave a more expansive view of the housing market, in which he mentioned specifically the fact that very tight refinance lending standards have diluted the impact of low interest rates (check) and that the Fed would consider additional options – purchasing more Mortgage-Backed Bonds or “MBS – to drive interest rates lower if circumstances warrant (double check.)
Bottom line: Lots of mortgage rate friendly data to chew on. All eyes – some of whom reside at the Fed – will be affixed squarely on mortgage interest rates and the expanded “HARP II” refinancing initiative (announced last week, goes mostly live Dec 1st) to help housing, and help the economy.
Thinking about refinancing? Waiting for HARP II (underwater refinance program changes)? Don’t miss last week’s post on HARP II – Help for refinancing underwater mortgages.
Have other mortgage related questions? Drop me a line with a few bullet points about your situation – I lend in 50 states, answer my own email, and work with my readers all the time.