Mortgage rates enter new range

Although it is illegal to sell a body part in the United States thousands of people do it every day.  On this day in 1881 the American Red Cross was founded.  Since then people have been selling pints of blood for a cup of juice and a cookie nearly every day.  

Mortgage Rates  

Mortgage rates worsened modestly last week.  The US 10-year treasury note, which home loan rates tend to track, is now yielding over 3.00%.  It is at the highest level since 2011.

Most every analyst’s interest rate prediction for 2018 has been surpassed including my own.  I thought mortgage rates would increase to 4.625%-4.875%. Here is what others thought:

US Stocks

The Dow Jones Industrial Average reacted positively to comments made by US Treasury secretary Steve Mnuchin earlier today.  He stated that the trade dispute between the US And China was “on hold”. The Dow spiked 350 points at the opening bell.

When stocks rally it tends to hurt mortgage rates.

The Week Ahead

This week’s economic calendar is fairly light.  On Wednesday we’ll get minutes from the May 2nd Fed meeting which can always move the markets.  Aside from that I’ll be watching New Home Sales (Wednesday), Existing Home Sales (Thursday), and the FHFA Home Price Index (Thursday).

Outlook

It appears that rates have entered into a new trading range.  I expect the current level of rates to be at the lower end of the range with room for them to be .25% higher than current levels.  I recommend locking.

Current Outlook: locking