Mortgage rates are holding steady so far this week. It’s no surprise, really, as there’s been very little meaningful economic data out these past two days.
Tomorrow, though, we get a few notable releases so there’s definitely the chance that we’ll get a market reaction.
Long-term rates are still expected to rise, which is why we’re recommending that borrowers lock in a rate soon. Read on for more details.
Market Outlook 5.21.18 from Total Mortgage on Vimeo.
Where are mortgage rates going?
Rates still holding steady
There’s not much economic data out, keeping market movement fairly muted today. The yield on the 10-year Treasury note, which is the best market indicator of where mortgage rates are going, is flat on the day at 3.06%.
That’s very close to the seven year high that it briefly hit on Thursday. Depending on who you talk to, there’s plenty of room left to run for the 10-year yield.
With the Federal Reserve getting ready to raise the nation’s benchmark interest rate, the federal funds rate, at least two more times in 2018, some analysts are saying the 10-year yield could easily hit 4.00%.
With mortgage rates closely tied to the bond market, that would put significant upward pressure on rates.
This isn’t anything new to anyone who’s been paying attention to the market this year; back in January we had many projections for the 30-year fixed rate to go as high as 5.00% by the time 2019 rolls around.
In the Freddie Mac Primary Mortgage Market Survey last week we saw the average rate on a 30-year fixed rate move up to 4.61%. That’s up sixty-six basis points from the start of the year.
We’ve still got another thirty-nine basis points to climb before 5.00%, but that could easily be covered over the next seven months.
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Rate/Float Recommendation
Lock before rates move even higher
With mortgage rates on track to climb higher and high over the coming weeks and months, we believe that it makes sense to lock in a rate on a purchase or refinance sooner rather than later.
Learn what you can do to get the best interest rate possible.
Today’s economic data:
Richmond Fed Manufacturing Index
The Richmond Fed Index hit a 16 in May. That’s a strong reading that is right on the brink of escaping the high end projection.
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Notable events this week:
Monday:
- Chicago Fed National Activity Index
- Fedspeak
Tuesday:
- Richmond Fed Manufacturing Index
Wednesday:
- PMI Composite Flash
- New Home Sales
- EIA Petroleum Status Report
- FOMC Minutes
- Fedspeak
Thursday:
- Jobless Claims
- FHFA House Price Index
- Existing Home Sales
- Kansas City Fed Manufacturing Index
- Fedspeak
Friday:
- Durable Goods Orders
- Consumer Sentiment
- Fedspeak
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from Total Mortgage Blog https://ift.tt/2rZJOU9
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