Mortgage Rates Higher, But Not Because Of The Fed

Posted To: Mortgage Rate Watch

Mortgage rates were slightly higher today, but not because of the Fed. Today brought a Fed policy announcement which can be quite a big deal for rates, depending on the particulars. This time around, those particulars were almost exactly the same as the previous Fed statement. Investors will sometimes read some significance into such an absence of change, but that wasn't a factor today. Of far greater importance to rates was an update from the Treasury department that spelled out near-term borrowing plans. Government spending is funded in large part by the issuance of Treasury debt. The more debt issued, the greater the supply and Econ 101 tells us what happens when supply rises: prices fall! While falling prices might sound like a good thing, in the case of Treasury debt, it means investors...(read more)

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