Mortgage rush underway as rates set to move even higher
People interested in buying a house and getting a mortgage played a version of beat the clock ahead of the anticipated interest rate increase coming from the Federal Reserve on Wednesday afternoon.
The Fed is expected to sharply raise
its key short-term rate – a third straight three-quarter-point hike is likely to be announced – as its previous rate hikes are being felt by households across the economy.
Ahead of the Fed’s move, overall demand for a mortgage application rose 3.8% compared with the prior week, according to the weekly survey from the Mortgage Banker’s Association.
“As with the swings in rates and other uncertainties around the housing market and broader economy, mortgage applications increased for the first time in six weeks but remained well below last year’s levels, with purchase applications 30% lower and refinance activity down 83%,” Joel Kan, MBA’s associate vice president of economic and industry forecasting. “The weekly gain in applications, despite higher rates, underscores the overall volatility right now as well as Labor Day-adjusted results the prior week.”
Gasoline price gains for first time in 99 days
The average price of a gallon of gasoline gained on Wednesday to to $3.681, according to AAA. Tuesday’s price was $3.674.
Gas rose for the first time since hitting a high of $5.016 on June 14.
Diesel’s price slipped to $4.928 per gallon.
Futures trade cautiously ahead of Fed decision
U.S. equity futures traded between gains and losses Wednesday morning ahead of the latest decision on interest rates by the Federal Reserve.
The major futures indexes were searching for direction ahead of the opening bell.
Oil prices were steady Wednesday morning following the previous day’s losses.
U.S. West Texas Intermediate crude was at $84.00 a barrel.
Brent crude futures traded around $90.00 a barrel.
The central bank is expected to raise interest rates in the afternoon following the latest policy meeting. It is expected to sharply raise its key short-term rate — a third straight three-quarter-point hike is likely to be announced – its previous rate hikes are being felt by households across the economy.
The Fed’s latest move is expected to raise its benchmark rate to a range of 3% to 3.25%, the highest level in 14 years.
The rate on the 10-year Treasury was at 3.52% on Wednesday.
Also on the economic agenda, the National Association of Realtors is expected to say that sales of previously owned homes fell 2.3% in August …….