Are REOs ready for a comeback?

Are REOs ready for a comeback?

Clear Capital: Increases in distressed, seasonal changes suggest yes

Mortgage application defects keep rising

Michigan, Florida, Texas lead First American application defect index

Monday Morning Cup of Coffee: When will mortgage lending pick up?

Plus, more on the future of Fannie and Freddie

FOMC tapers another $10 billion

Bond purchases nearly over as October approaches

Federal Reserve logo
/ Print / Reprints /
| Share More
/ Text Size+

The Federal Reserve will continue to taper and reduce its pace of bond purchases by another $10 billion as labor market conditions improve and the unemployment rate declines further, the June Federal Open Market Committee meeting minutes said.

However, the FOMC cautioned that there remains significant underutilization of labor resources, with the recovery in the housing sector moving at a slow pace.  

Since the committe believes there is sufficient underlying strength in the broader economy to support ongoing improvement in the labor market, beginning in August, the committee will add to its holdings of agency mortgage-backed securities at a pace of $10 billion per month rather, and will add to its holdings of longer-term Treasury securities at a pace of $15 billion per month.

“The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate,” the minutes said.

The federal funds rate will maintain the current 0 to 1⁄4 percent target range.  

The last minutes showed the Federal Reserve is debating having the final reduction come in a single $15 billion reduction, or in a $10 billion reduction followed by a $5 billion reduction, which would make the final reduction in October.  

Recent Articles by Brena Swanson

Comments powered by Disqus