Fed News Forecasts Rise in Mortgage Rates

News from the head of the Federal Reserve in Boston said he expects mortgage rates to rise by ½ to ¾ of a point in the coming months as a result of the end of a government support program.

The chief executive of the Boston Fed, said in an interview that he expects mortgage rates to rise when the Fed MBS purchase program ends, or before, as the end approaches.

He said. "You maybe would have thought you would have seen rates move up more quickly than they have, but nonetheless that is a concern."
The Fed could extend the mortgage buying program if the economy deteriorated dramatically, but he said "That's not in our forecast, that's not what we're expecting."

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