Data released by Freddie Mac last week showed that average fixed mortgage rates fell to their lowest levels since the summer amid market speculation that the Federal Reserve will not slow its bond-buying program this year.
The 30-year fixed-rate mortgage averaged 4.13 percent, down from 4.28 percent the previous week and 3.41 percent the previous year. The 15-year FRM averaged 3.24 percent, compared to 3.33 percent the previous week and 2.72 percent one year ago.
The five-year adjustable-rate mortgage averaged three percent—a decrease from 3.07 percent the previous week and an increase from 2.75 percent this time last year. The one-year ARM averaged 2.6 percent, compared to 2.63 percent the previous week and 2.59 percent this time last year.
“Mortgage rates slid this week as the partial government shutdown led to market speculation that the Federal Reserve will not alter its bond purchases this year,” Freddie Mac Vice President and Chief Economist Frank Nothaft said. “The weak employment report for September added to this expectation. The economy added just 148,000 jobs, which was below the market consensus forecast and less than the 193,000 jobs increase in August.”
The Fed begins its two-day policy meeting on Tuesday and is expected to maintain its bond-purchasing program at $85 billion per month, and many expect the central bank to delay withdrawing stimulus until March, CNBC reports.