Speaking last Wednesday, Federal Reserve Chair Janet Yellen formalized the possibility of a rate hike next month.
The Fed expects “the economy will continue to grow at a pace that’s sufficient to generate further improvements in the labor market and to return inflation to our 2% target over the medium term, and if the incoming information supports that expectation, then our statement indicates that December would be a live possibility,” Ms. Yellen said while testifying before the House Financial Services Committee. “But importantly, we’ve made no decision about it.”
The 30-year fixed-rate mortgage averaged 3.87 percent for the week ending November 5, 2015, up from last week when it averaged 3.76 percent. A year ago at this time, the 30-year FRM averaged 4.02 percent.
The 15-year FRM this week averaged 3.09 percent, up from last week when it averaged 2.98 percent. A year ago at this time, the 15-year FRM averaged 3.21 percent.
The 5-year Treasury-indexed hybrid ARM averaged 2.96 percent this week, up from last week when it averaged 2.89 percent. A year ago, the 5-year ARM averaged 2.97 percent.
The 1-year Treasury-indexed ARM averaged 2.62 percent, up from 2.54 percent last week. At this time last year, the 1-year ARM averaged 2.45 percent.
“Treasury yields climbed nearly 20 basis points over the past week, capturing the market movement following last week’s FOMC meeting. In response, the 30-year mortgage rate experienced its largest increase since June, up 11 basis points to 3.87%,”said Sean Becketti, Freddie Mac’s chief economist.
“Recent commentary suggests interest rates may rise in the near future. Janet Yellen referred to a December rate hike as a ‘live possibility’ if incoming information supports it. The October jobs report to be released this Friday will be one crucial factor influencing the FOMC’s decision,” Becketti added.
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Sierra Pacific Mortgage