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Mortgage Rates Back at 4-Year Highs Ahead of Inflation Data

Mortgage rates moved higher today as bond markets braced for impact from several upcoming events.  Bonds dictate rates, and as investor demand for bonds falls, rates rise. Investors were faced with the challenge of bidding at an auction of 10yr Treasury notes today.  In an environment where the Treasury is ramping up issuance in order to pay for fiscal initiatives, buyers want to see lower and lower prices before committing.  Lower prices mean higher yields for investors and higher rates for consumers.  The 10yr auction ended up going fairly well, but only after rates had already moved higher in the morning.  In other words, the auction confirmed that rates needed to rise. …(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read...

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Mortgage Rates Move Back Up

Mortgage rates are still technically in a sideways holding pattern, but today’s move took them slightly higher inside their recent range.  The average lender is back in line with Friday afternoon’s offerings.  This leaves most borrowers looking at rate quotes that aren’t quite as high as those seen on April 25th (4-year highs), but still .125-.25% higher compared to the end of March.   The unfortunate development today actually occurred in the Treasury market.  Although mortgages are officially dictated by the price of mortgage-backed-securities (MBS), Treasuries do more to set the tone of the overall market for interest rates in the US.    They’re like the trunk of the tree and the mortgage bond market is one of the bigger branches.  In other words, big developments in Treasuries have implications for mortgage rate momentum.  …(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read...

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Mortgage Rates Still Waiting to Make a Move

Mortgage rates have been exceptionally sideways for nearly 2 weeks now–this after hitting the highest levels in more than 4 years on April 25th.  As always, the run up to long-term highs happened in concert with weakness in the broader bond market.  Rates are based primarily on the prices of mortgage-backed securities (MBS).  In turn, MBS movement is heavily dependent on movement in the broader bond market (where bonds like US Treasuries are top dog, domestically).   All that to say: we’re not really witnessing a mortgage rate phenomenon, but rather a bond market phenomenon. …(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read...

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Mortgage Rates Start Lower, But Pushed Back Up After Jobs Report

Mortgage rates were sideways today, on average, but only after the dust settled on some morning volatility.  The big jobs report was released at 8:30am ET, and it frequently has an impact on the bond market that underpins mortgage rates.  While today’s effects weren’t huge, they were the biggest we’ve seen this week and they accounted for the quickest swings between stronger and weaker levels. The data itself was a bit weaker than expected.  Specifically, the economy added only 164k jobs compared to a median forecast calling for 192k.  Still, this was “good enough” as far as many traders were concerned, given that last month’s numbers were more than 60k lower when they were first released. …(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read...

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Mortgage Rates Fall Ahead of Big Jobs Report

Mortgage rates bounced back today–that is, they bounced back DOWN after rising slightly yesterday.  The improvement came courtesy of strength in European bond markets (stronger = more bond buying = higher bond prices = lower bond yields, aka “lower rates”).  Weaker domestic equities markets also played a part.  While the correlation isn’t always well-behaved, it’s not uncommon to see big stock losses translate to some excess demand for bonds (and again, more bond market demand/buying = lower rates).   …(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read...

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