Some softer than expected inflation data is keeping mortgage rates from moving out of the tight range that they’ve been in all week. Tomorrow we will get more inflation data, bringing with it the possibility of a rate adjustment before we head into the weekend. Read on for more details.
Where are mortgage rates going?
Rates flatten out again
Believe it or not there are some exciting weeks for mortgage rates. This has not been one of those weeks.
It’s not unexpected for the week following the monthly jobs report to be a dull one, so I can’t say I didn’t see it coming.
There just hasn’t been many significant economic reports out this week and the few reports that did get released weren’t much to talk about.
Today, we got the latest Consumer Prices Index reading, which came in slightly below expectations.
That means the inflation hawks will have to wait another day before they can rile up the troops with their talk of a quicker than expected tightening schedule from the Federal Reserve.
Here are the latest numbers in the Freddie Mac Primary Mortgage Market Survey:
- The average rate on a 30-year fixed rate mortgage remained unchanged at 4.55% (0.5 points)
- The average rate on a 15-year fixed rate mortgage fell two basis points to 4.01% (0.4 points)
- The average rate on a 5/1-year adjustable rate mortgage rose eight basis points to 3.77% (0.3 points)
Here’s what their Economic & Housing Research group had to say about rates this week:
“The 30-year fixed mortgage rate remained at 4.55 percent over the past week.
The minimal movement of mortgage rates in these last three weeks reflects the current economic nirvana of a tight labor market, solid economic growth and restrained inflation. As we head into late spring, the demand for purchase credit remains rock solid, which should set us up for another robust summer home sales season.
While this year’s higher rates – up 50 basis points from a year ago – have put pressure on the budgets of some home shoppers, weak inventory levels are what’s keeping the housing market from a stronger sales pace.”
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Rate/Float Recommendation
Locking now is likely the smart move
Mortgage rates are staying in a tight range for now but could very well be on track to increase substantially by the time 2019 rolls around.
At the very least, it’s far more likely that mortgage rates will rise than fall in the coming weeks and months.
So if you’re looking to buy a new home or refinance your current mortgage, the better option is likely to lock in a rate sooner rather than later.
Learn what you can do to get the best interest rate possible.
Today’s economic data:
Consumer Price Index
The consumer price index rose 0.2% month over month in April, putting it at 2.5% year over year. CPI less food and energy ticked up 0.1%, month over month putting it at 2.1% year over year.
Jobless Claims
Applications filed for U.S. unemployment benefits came in at 211,000 for the week of 5/5/18. That brings the four-week moving average to 216,000.
Bloomberg Consumer Comfort Index
The Bloomberg consumer comfort index hit a 55.8 for the week of 5/6/18.
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Notable events this week:
Monday:
- Fedspeak
Tuesday:
- NFIB Small Business Optimism Index
- JOLTS
Wednesday:
- PPI-FD
- 10-Yr Note Auction
- Fedspeak
Thursday:
- Consumer Price Index
- Jobless Claims
- Bloomberg Consumer Comfort Index
Friday:
- Fedspeak
- Consumer Sentiment
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from Total Mortgage Blog https://ift.tt/2KQ1NUV
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