Holden LewisAssistant managing editor, Bankrate.com
There was an upward bump in mortgage rates on Wednesday afternoon involving speculation about QE3. Rates will settle lower. I agree with Michael Becker, and he says it better.
Michael BeckerMortgage banker, WCS Funding Group, Lutherville, Md.
The stock market has been rallying this week and that has been accompanied by rising Treasury yields and mortgage rates. A big part of the rally is based on speculation that Ben Bernanke will announce a third round of quantitative easing during his speech at Jackson Hole, Wyo., this Friday. I expect the markets to be disappointed in his speech and that stocks will sell off and bonds will rally. This will cause rates to fall in the coming week.
Dan GreenWaterstone Mortgage, author of TheMortgageReports.com, Cincinnati
Rates resume sliding on a flight to quality.
Dick LepreSenior loan officer, RPM Mortgage, San Francisco
Technical analysis of the 30-year Treasury future is indicating that we may soon see absurdly low Treasury yields and mortgage rates. The techs point to a 3 percent 30-year yield and a 1.5 percent 10-year yield.
It is hard to believe that we will actually get there, but even if we move half the distance indicated by the techs, we will see record-low yields and, presumably, mortgage rates.
This will not happen without either: 1) bad fundamentals (GDP report is Aug. 26), 2) eurozone issues, which could create losses to banks holding debt and a European banking/liquidity crisis, or 3) the unforeseen.
John WalshPresident, Total Mortgage Services, Milford, Conn.
The movement in mortgage rates over the next week comes down to Fed Chairman Bernanke's comments this Friday in Jackson Hole, Wyo. Will he allude to QE3? Will he discuss other possible methods the Fed could use to provide stimulus to the U.S. economy? I think not. He will likely state that the Fed has tools remaining and is prepared to use them, but will stop short of specific commitments. What is likely is a repeat of his pledge to hold interest rates low through mid-2013. That should be sufficient, I believe, to push rates back down to all-time lows.