Orion’s brokers know that the Federal Reserve Bank of the United States does not set 30-year mortgage rates. But the same factors that influence the Fed in its decision making also influence bond investors around the world. And therefore, the mortgage rates which impact your clients. And so Orion’s management and AEs are carefully watching this week’s economic news and Federal Reserve activity.

But the U.S. Federal Reserve doesn’t operate in a vacuum. This week brings the latest decisions from the Fed on Wednesday and the European Central Bank (ECB) and Bank of England (BoE) on Thursday where they are respectively expected to hike rates by .25 percent, .50 percent, and .50 percent. There is also some important data culminating with the January employment report on Friday including the Employment Cost Index, consumer confidence, Purchasing Indices, productivity and unit labor costs, a key OPEC gathering, plenty of corporate earnings reports, and Challenger job cuts.

Jobs and housing drive the economy in the United States. On the macro economic calendar,the unemployment report at the end of the week is expected to show a rise in nonfarm payrolls of 225K with the end of a strike by University of California workers in late December a positive factor. Private payrolls are forecast to rise by 200K following a 220k increase in December. Bank of America thinks behind the strong payroll print, some details will show cracks in the foundation, particularly in manufacturing.

But most of our attention will be on the Federal Open Market Committee meeting. The Federal Reserve is largely anticipated to come out of the meeting with a 25-basis point rate hike to take the target overnight federal funds rate to 4.50% to 4.75%. (The Fed Funds rate is what banks are charged by other banks.) The consensus view is that the Fed will continue with its tightening policy and signal more rate hikes are still in the mix. The transitory elements of inflation have comedown, but the underlying problem of excessive stimulus remains.

Mortgage rates will do whatever they do: go up, go down, or stay the same. Orion’s brokers and your clients should keep in mind that, regardless of what rates do, we will continue to provide our brokers with some very good home buyer programs as well as refinancing options that will make it worth your while learning about.

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