Shopping For Rates is Difficult in a Volatile Market
On most days, lenders issued multiple rate sheets with the trend putting rates higher in the morning, and lower in the afternoon.
Overall, mortgage rates were unchanged on the week. It broke a three-week streak through which mortgage rates rose.
Rates remain roughly one-half percent higher than the lows of early-October.
The biggest positive for rate shoppers last week was tame economic data — specifically concerning the Producer Price Index and the housing sector.
The Producer Price Index is an inflationary, Cost of Living-like measurement for businesses and it went negative in September. Analysts weren’t expecting that and the surprise pulled rates down an eighth.
Mortgage Rates Rise as the Value of the U.S. Dollar Decreases
Similarly, in housing, both the Home Price Index and Housing Starts figures were softer than expectations. These, too, tugged mortgage rates down.
At least temporarily.
We say “temporarily” because — all week long — a steadily-weakening U.S. dollar was leading mortgage rates higher.
All things equal, mortgage rates rise as the dollar loses value and, last week, the dollar touched a 14-month low versus the Euro. The greenback’s weakness countered most of the “positive” news for rate shoppers and is a major reason why rates were so volatile.
Specifically, What Did Those Reports Say?
Each week, I put up an economic calendar of news coming out that following week. Here’s the what actually happened with those reports last week:
What Impacts Mortgage Rates?
If you’re looking to purchase or refinance a home, it’s important to know what moves mortgage rates. There are normally two major things that impact the direction:
- Economic News. (Like the calendar above).
- International News. (major events, pending legislation, war related news, etc).
- Stock Market. (Money flows from equities (stocks) to bonds when it seeks shelter).
What Are Rates Based On?
It’s been mentioned before, but as a common reminder – mortgage rates are only based on one thing, Mortgage Backed Securities (MBS). The only way you have access to these is through live bond quotes.
Looking For Mortgage Rates?
If you’re looking for specifically what mortgage rates are doing, I’d be happy to help with a custom rate quote. Each scenario is different (there are 27 different factors a mortgage rate is determined by). If you or someone you currently know are looking for a mortgage, I’m here to help!
Information without obligation. That’s my policy. If you like what you hear, my team and I would love to help you out with your mortgage!
