Yesterday wrapped up the Fed’s two day meeting and, as expected, there was no change to Fed Funds rate. They did announce in their statement they will ease off another cool $10 Billion per month starting in February of their mortgage backed security purchase program.
From the press release:
Beginning in February, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $30 billion per month rather than $35 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $35 billion per month rather than $40 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee’s sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee’s dual mandate.
The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee’s expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings.
This morning, mortgage rates are slightly higher. As of 7:23 am on January 30, 2014, I am quoting:
30 year fixed conforming: 4.375% priced with 1.192 points (apr 4.523%) based on a $400,000 loan amount with an 80% loan to value and 740 or higher credit scores for a purchase in Bellevue closing by March 7, 2014 or sooner.
This is roughly 0.52% higher in points or roughly 0.125% higher in fee from what I quoted on Monday.
Mortgage rates change constantly and may have changed by the time you’re reading this post. If you would like me to provide you with a mortgage rate quote for your home located anywhere in Washington state, please click here.