Mortgage rates remained flat again this week as traders seemed to continue to hold a balanced view of the improving economy, muted inflationary pressures, and government support for financial markets.
We did see a few more signs of improving conditions, and also reminders that we are still not on solid
footing yet. The Fed also meet last week, leaving rates unchanged as expected. As the economy
improves, it is very likely that the Fed will let various support programs expire, such as the $300
billion program of buying Treasury debt that expires in four weeks.
This is a jam-packed week of economic data for markets to digest. The reports include the final
reading for last quarter’s GDP, the ISM Manufacturing Index, Consumer Confidence, and
September’s employment report. After the Fed’s meeting last week, if the data comes in revealing
growing economic strength, it would not be surprising to see mortgage rates beginning to trend slowly
upward. However, if unemployment jumps to 10.0%, we’ll see rates stay low.