I have been saying this for a while, but this Excellent articlein CNNMoney says it again and very well.  this is definitely worth reading if you are thinking of refinancing or buying a home in the near future.  If economic news is still bad or worsens then mortgage rates could go down.  Here are the best lines from the article.  A definite recommend for reading.

The Fed’s main tool is control over the short-term fed funds rate, which determines what banks charge each other for overnight loans. Long-term mortgage rates are mostly tied to the 10-year Treasury yield, which is determined by bond traders worldwide.

“There is a long disconnect between the fed funds rate and fixed mortgage rates,” said Keith Gumbinger, vice president of mortgage and consumer loan information publisher HSH.com.

Inflation drives long-term fixed rates.