Economics
Fed Is Reaching Limit on What It Can Do to Lower Mortgage Rates
- Lenders must shrink spread over market if rates are to fall
- Freddie Mac 30-year mortgage already at all-time low of 3.13%
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American home buyers have cheered the drop in mortgage rates to record lows, and now it’s natural to ask if they will head even lower.
The U.S. 10-year Treasury yield has closed within a narrow 0.33% band since the end of the first quarter, and finished as low as 0.57% on April 21. It ended Tuesday at 0.71%. The Freddie Mac 30-year mortgage rate, meanwhile, dropped to a record low 3.13% on June 18.