Mortgage Rate Trend Index Down: Dec. 18, 2014

Will rates go up, down or remain unchanged?

  • Michael Becker

    Michael Becker

    Branch manager, Sierra Pacific Mortgage, White Marsh, Maryland

    U.S. Treasuries have been benefiting from a flight to safety over the last week. Concern over the rapid drop in oil prices, the Russian ruble and Russian stock market have been a major reason for this flight to safety. This bid in U.S. Treasuries has lowered their yields and mortgage rates over the last week. This move lower in rates has come despite the Fed meeting this week and the market's expectation that the Fed may hint at raising short-term rates soon by removing the phrase that rates will stay low for a "considerable time." Right now, I think concern over Russia and the drop in oil prices is weighing on markets more than what the Fed will do. I expect a small spike in rates after the Fed statement is released, but that will be reversed in the coming week with rates dropping ever lower.

  • Dick Lee

    Dick Lee

    President, Independent Mortgage, Newton, Massachusetts

    Rates will improve, as the markets are seeing big swings both up and down. The investors are seeking shelter in the safe haven of bonds.

  • Dick Lepre

    Dick Lepre

    Senior loan officer, RPM Mortgage, San Francisco

    We are seeing gigantic movement of money as a consequence of the decline in oil prices and the enormous fall in the value of the ruble. In 1998, the decline in the ruble caused the Fed to bail out hedge fund LTCM because it feared that not doing so would cause contagion and even larger losses. It will take nerves of steel for the Fed to do so when the average citizen still does not know that it was not the owners of banks, but rather the depositors who were bailed out post-Lehman.

  • Holden Lewis

    Holden Lewis

    Assistant managing editor,

    When investors digest the Fed's statement, Treasury yields will fall. Not much, though. Russia's desperate attempt to dissuade investors from selling their rubles will backfire. That will have an even bigger effect on Treasuries and on mortgage rates, sending both lower, as investors buy bonds in safer currencies such as the dollar.

  • Greg McBride

    Greg McBride, CFA

    Chief financial analyst,

    Unless the Fed spooks the market, expect global jitters to hold sway over rates in the coming week.


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