Florida home loan rates dropped Wednesday after the Federal Reserve released the minutes from its April 28-29, 2009 meeting.
The Fed Minutes – A Brief Background
Known widely as the “Fed Minutes,” the report provides an in-depth account the Fed’s last meeting, detailing the decisions and discussions that shape our nation’s financial policies. Think of the “Fed Minutes” as a longer and more detailed version of the Federal Reserve’s summarized, post-meeting press releases.
For comparison’s sake, the Federal Reserve’s April 29 announcement contained 383 words. The minutes of that same meeting held 5,754 words. The extra words offer extra details about what the next monetary steps might be for the nation’s policymakers.
How the Fed Minutes Impact Mortgage Rates
As many of you already know, investors are always on the lookout for clues about where the market is going next. This is especially evident by the fact that the April 2009 Fed Minutes showed that Uncle Ben and Company discussed increasing their $1.25 trillion home loan market commitment to a larger amount.
Remember that the Fed’s home loan-buying program is mostly credited with keeping home loan rates low this year. If there’s more buying in the future, that should help home loan rates stay low. Home loan rates fell Wednesday in anticipation of just such a move. For now, though, the Fed Minutes are just talk.
What’s imporant in terms of a take away from this post is that it pays to understand what forces move home loan rates so that you can be ready to act when they’re low, rather than miss the mark.
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