US mortgage rates remained relatively flat on Monday, even though some lenders were quoting marginally higher rates. This means they remained at their highest level in well over two weeks depending on the individual credit provider.
The bond markets that underpin rate movements were in somewhat better shape yesterday morning because of weakness in bond markets on Friday afternoon that did not find its way to lower rates as one might have expected.
There were no important political or economic events that could drive rates higher or lower yesterday, but that will change rapidly as Friday approaches. Tomorrow brings crucial inflation data from the Consumer Price Index.
Rate markets are also eagerly waiting for news about the new tax legislation, so Thursday’s vote on the House version of the bill could significantly affect mortgage rates.
In the middle of all these potential market movers, it would be wise to prepare for higher rates until there is undeniable proof that rates are heading lower.
US mortgage expert Ted Rood pointed out that rate markets were fairly quiet yesterday, with only small improvements during the afternoon.
He added: “There's not a lot of economic data on tap this week, and with President Trump's Asian trip failing to ignite any international drama, I'm not sure where markets will focus. I don't see a lot to be gained by either floating/locking, probably best to lock if within 30 days of closing.”
This year has turned out to be a fairly good one for mortgage rates despite previous expectations for increased upward pressure after President Trump took office.
Although rate remain relatively low in absolute terms, they have been edging higher in a more aggressive way as the fourth quarter progresses, particularly when compared to the improvements and stability we saw earlier this year.
The standard view for now is that there is a strong potential for this uptrend to continue. It will require more than just a handful of breakouts to the downside for that view to be reversed.
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