Back Where We Started…

  • December 20, 2013

jeremytoonJanet Yellen moved one step closer to becoming the next chairman of the Federal Reserve this afternoon. Why am I telling you this, and why is it important? Well, as we know from Wednesday the Federal Reserve moved forward in its decision to slow (buzzword = taper) bond purchases. Yellen is very likely to have a very similar approach to her predecessor, and during Ben Bernanke’s Q&A following Wednesday’s rate decision, mentioned that he consulted with Yellen on her plans going forward. In the markets today:

  • U.S. Final Q3 GDP was up 4.1%, which is the biggest increase since Q4 of 2011. Continued signs that the economy is improving and a stronger case for slowing bond purchasing
  • Eric Rosengren, the lone dissenter in Wednesday’s decision to taper on Monday and president of the Federal Reserve Bank of Boston, said he would have preferred to wait until March. However, he mentioned that the Fed was likely to complete its purchase program sometime late in 2014
  • While mortgage rates moved higher in the immediate aftermath of the tapering decision, rates improved today. This leaves us standing right back where we were before the announcement hit.

Hope you have a great weekend, I know I will fighting the crowds going store to store doing my last minute holiday shopping.

By Jeremy VanBuskirk, Quicken Loans Capital Markets Analyst

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