Florida mortgage borrowers may soon see mortgage rates rise as the U.S. economic forecast set forth from the November 4 FOMC press release was fairly optimistic.
The Federal Open Market Committee voted to leave the Fed Funds Rate within its target range of 0.000-0.250 percent.
Stating that the U.S. economy “has continued to pick up” since the September FOMC meeting and that housing market activity has increased, “Uncle” Ben Bernanke and company seem to believe that we’re out of the woods – or nearly so.
However, there is reason for a small degree of continued concern, which can be supported by several points the Fed advised us to watch out for including:
- Job losses for American workers continue to mount
- Businesses continue to reduce fixed investment activity
- Financial markets still face some ongoing challenges
These concerns taken into account, the overall tone remained positive, as inflation appears to be holding steady for now.
Rounding out its statement, the Fed announced that it will hold true to its plan to keep the Fed Funds Rate near zero percent “for an extended period” and to remain committed to its $1.25 trillion pledge to bolster mortgage bond market. However, the Fed will continue to wind down its mortgage market support over the next 5 months, reaffirming its March 2010 exit date. For now, Fed support is helping to keep Florida mortgage rates down.
The Florida mortgage market reaction to the Fed’s press release is negative overall. As such, mortgage rates in Florida are rising.
The FOMC’s next scheduled meeting is December 15-16, 2009.
