Commentary: Traders are simply marking time as they await the 12:30 p.m. ET release of the Federal Open Market Committee's post-meeting statement and the 2:15 p.m. start of Fed Chairman Ben Bernanke's press conference.
The general consensus among Fed watchers suggest policymakers will probably affirm a decision to end bond purchases and will repeat their long standing pledge (first made in 2008) to hold their benchmark short-term interest rates near zero percent for an "extended period."
Later this afternoon, in his second-ever news conference, Fed Chairman Bernanke is expected to reconfirm the Fed's forecast for a pick up in economic growth in the second-half of the year. He is almost sure to confirm the likelihood of further quantitative easing in the form of "QE3" remains very low. Bernanke will likely face tough questions about Greece and the impact of Europe's debt crisis on the U.S. economy. Look for his answers on this subject to be short on specifics and generally deflective overall.
Most observers believe today's post-meeting statement from the Federal Open Market Committee and Bernanke's press conference will exert little, if any noticeable influence on the trend trajectory of mortgage interest rates.
As they do every Wednesday, the Mortgage Bankers of America have released their Mortgage Application Survey for the week ended June 17th. Overall loan demand slipped 5.9% lower during the week. The number of refinance applications fell 7.2% (even with this pullback - it is still near its best level of the year). The number of purchase applications fell by 2.3% from the prior week.
The average contract rate for 30-year fixed rate mortgages finished at 4.57%, 6 basis points higher than the week ago mark, 12 basis points lower that four weeks ago, and 18 basis points below the year ago level. Refinance request represented seven out of every ten loan applications taken last week.
THE MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
