30 Year Fixed-Rate Matches Historic Low, Employment Report Due on FridayDec 1 2009
December 1, 2009 - Thirty-year, fixed-rate mortgages matched their historic low of 4.78% last week, a figure likely to generate more new home purchases and refinancing activity. Additionally, both the fifteen-year and the five-year ARM rates dropped to all time lows. With a tepid recovery and ongoing market pressures driving rates lower, the continued support from the Federal Reserve has helped and will continue to help hold rates at these low levels.
With recent events in the Middle Eastern financial markets, we could see mortgage rates staying at these low levels this week, perhaps even moving downward if the week's data point toward a stalling recovery. The ISM, one of the week's biggest reports, took a slight dip to 53.6% for the month of November. Despite this slip from the 55.7% in October, a reading above 50 still indicates expansion. All eyes will be watching Friday's Employment Report. If job losses slow to below a monthly average of 250K or less over the next 60-90 days, mortgage rates may begin to drift higher in the coming months.