The Fed Will Still Raise Rates in March , And That’s Why Rates May Keep Falling

There’s certainly a chicken/egg problem when it comes to interest rate news. Is it the Fed’s decisions that move rates? Or do market forces move rates, thus forcing the Fed to react? The answer is somewhere in between. If inflation and economic growth were always positive, low, and stable, the Fed would never lift a finger, but they are compelled to act when stability is threatened. Since March 2020, the Fed has acted quite a bit. They maintained rate-friendly policies for almost 2 years and then got precipitously unfriendly early in 2022. “Unfriendly,” in this case, refers to hiking the Fed Funds Rate and buying fewer bonds on the open market. The combined effect was one of the sharpest rate spikes in history. Now after more than a year of unfriendliness, the Fed is finally thinking about leveling off and seeing how things play out without too many more rate hikes. They’ve already decreased the pace from 0.75% per meeting to 0.25%. This isn’t a random decision on the part of the Fed. It comes in response to shifts in inflation data as well as other signs that their unfriendly policies are having an effect on the economy. The latest sign is the banking drama that has been in the news this week. It began with Silicon Valley Bank last week but spiraled into a bigger problem with the closure of Signature bank over the weekend. Many people have never heard of these institutions, but they now represent the 2nd and 3rd largest bank failure in US history.

March 17, 2023 Download our Mobile App: Download our Mobile App: Mortgage Rate Watch The Fed Will Still Raise Rates in March, And That’s Why Rates May Keep Falling There’s certainly a chicken/egg problem when it comes to interest rate news. Is it the Fed’s decisions that move rates? Or do market forces move rates, thus forcing the Fed to react? The answer is somewhere in between. If inflation and economic grow... (read more) MBS Commentary Simple, Boring, Half Point Rally in MBS Simple, Boring, Half Point Rally in MBS There won't be too many days with a half point MBS rally that are as boring as Friday. None of the economic data was very interesting or even exceptionally releva... (read more) Rob Chrisman Broker, Efficiency Products; FHA, VA, USDA News; Bank Failures Explained It hasn’t been a good few weeks for banks whose names begin with “Si” (Silvergate, Silicon Valley, and Signature, with Silicon Valley Bank declaring Chapter 11 bankruptcy this morning; today’s Rundown discusses how the bank crisis may impact lenders)... (read more) Mortgage Rates 30 Yr. Fixed Rate 6.55% -0.14% Rate Change Points Mortgage News Daily 30 Yr. Fixed 6.55% -0.14 0.00 15 Yr. Fixed 5.98% -0.12 0.00 30 Yr. FHA 6.15% -0.05 0.00 30 Yr. Jumbo 6.12% -0.08 0.00 5/1 ARM 6.35% +0.23 0.00 30 Yr. VA 6.19% -0.06 0.00 Updates Daily - Last Update: 3/17 15 Yr. Fixed Rate 5.98% -0.12% Rate Change Points Freddie Mac 30 Yr. Fixed 6.60% -0.13 0.00 15 Yr. Fixed 5.90% -0.05 0.00 Updates Weekly - Last Update: 3/16 Rate Change Points Mortgage Bankers Assoc. 30 Yr. Fixed 6.71% -0.08 0.79 15 Yr. Fixed 6.14% -0.11 0.77 30 Yr. Jumbo 6.39% -0.10 0.61 Updates Weekly - Last Update: 3/15 MBS / Treasuries UMBS 30YR 5.0 99.77 +0.55 Price / Yield Change MBS UMBS 5.0 99.77 +0.55 UMBS 5.5 100.92 +0.48 GNMA 5.0 100.28 +0.58 GNMA 5.5 101.16 +0.23 Pricing as of: 3/17 5:31PM EST 10 Year US Treasury 3.4360 -0.1429 Price / Yield Change US Treasury 2 YR Treasury 3.848 -0.326 5 YR Treasury 3.504 -0.230 7 YR Treasury 3.502 -0.189 10 YR Treasury 3.436 -0.143 30 YR Treasury 3.632 -0.080 Pricing as of: 3/17 5:31PM EST Latest Video A 25 bps hike seems most likely at next Fed meeting, says Janney Montgomery... The Bond Report: Treasury rates plummet The Fed is going to try and compartmentalize financial instability risk, sa... Former ECB President Jean-Claude Trichet weighs in on Credit Suisse and ECB... Around the Web CNBC Fed poised to approve quarter-point rate hike next week, despite market turmoil Calculated Risk Blog Lawler: Early Read on Existing Home Sales in February CNBC First Republic shares fall more than 20% despite deposit infusion, dragging down other regional banks Reuters Investors pile into cash at fastest weekly rate since April 2020 CNBC Why bank runs like the SVB collapse happen: 'It's like a mass delusion that becomes a reality' The Basis Point First Republic for sale, maybe. Won’t be first time. Eye on Housing NAHB 2023 Priced Out Estimates State and Local Estimates Calculated Risk Blog Q1 GDP Tracking: Wide Range Eye on Housing Single-Family Starts Remain Lackluster but Will Rebound Later This Year CNBC Yellen says U.S. banking system is 'stable' and deposits 'remain safe' following failure of SVB, Signature Calculated Risk Blog Hotels: Occupancy Rate Down 7.5% Compared to Same Week in 2019 CNBC Treasury yields mixed as investors consider outlook for bank stocks, monetary policy CNBC Credit Suisse sheds another 5% as traders digest emergency liquidity

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