Week of March 19th: Economic Roundup

March 23, 2012 by · Leave a Comment 

Mortgage rates have been remarkably stable for four months but have experienced an unexpected bump-up over the last couple of weeks.  The main reason for the up-tick is investor reaction to optimistic comments from the latest March 13th Federal Reserve meeting.  These comments caused investors to reduce expectations that the Fed will continue to purchase mortgage-backed securities (MBS).  Recent sentiment had been that they would and this had greatly contributed to recent mortgage rate lows.  The Fed statement also acknowledged that rising energy prices will lead to higher short-term inflation.  In fact, last week’s PPI and CPI inflation figures indicate that this is already happening.