Mortgage Rates
It would be incorrect to state that there is a *direct* relationship
between fixed mortgage rates and the Fed Funds rate, but there
definitely is significant correlation between the two. Lots of things
usually happen when the Fed cuts rates; I say usually,since things are
working a bit differently now given that the market seems
psychologically bounded. Ok,Fed cuts rates,the costs of lending goes
down for banks on a short-term basis. So,of course,the rate on a
30-year mortgage isn’t going to drop lock-step with a near
quarterly-adjusted OVERNIGHT rate,but the correlation IS there because
of its impact on the capital markets as a whole and, in more recent
years,due to utter disregard for responsible risk management.A better benchmark would be the yield on a 10Y treasury bill. The yield
for these tend to correlate very strongly with the 30Y mortgage rate
since 10 years is how long it takes,on average,for these mortgages to
be paid off.
Mortgage Rates
Mortgage Rates
Mortgage Rates
Mortgage Rates
Mortgage Rates
Mortgage Rates
Mortgage Rates
Mortgage Rates
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