Looking to purchase or refinance a home? It may pay to act before rates rise further!
On November 22, President Joe Biden announced the re-nomination of Federal Reserve Board Chairman Jerome Powell. Both said they are focused on fighting inflation. Inflation is a key forecast concern for the economy.
What does a good inflation fight mean for markets and rates?
Typically, the Fed’s best weapon against inflation is to cool the economy by increasing the Fed Funds Rate. This rate doesn’t specifically target mortgage rates but historically has been shown to be a viable indicator of future movements.
Bond and mortgage markets continued to push mortgage rates higher after the announcement.
Questions remain about how fast and how far the Fed will go with policy rate increases and the further tapering of mortgage bond purchases, which have helped keep rates at record lows since the spring of 2020.