Mortgage Rates Not Too Troubled by European Tapering
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by Trevor Sines

Mortgage rates were only somewhat higher today, on average, and some lenders were actually right in line with yesterday’s offerings.  All this despite the fact that the European Central Bank (ECB) confirmed rumors that it was planning on reducing the amount of bonds it buys each month.  While many of the details are different, this is functionally similar to the Fed’s mid-2013 acknowledgement that sparked the taper tantrum (which began 2 of the worst months in the history of mortgage rates).  

Thanks to lumps already taken as a result of the election, rates were relatively unfazed by today’s ECB news, but not so unfazed that we should break out the champagne just yet.  Bond markets still had an unfavorable reaction, and on average, rates did move higher.  Additionally, we’re already operating very close to 2-year highs, so it’s hard to get too excited about anything that leaves rates in that territory–even if it’s not prompting an ugly move to even higher highs.  

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