Mortgage rates are unchanged today.
There are a lot of potential market-changing headlines this morning but nothing seems to be driving the markets one way or the other.
Here in the US new applications for unemployment benefits were reported to have unexpectedly risen last week. This report comes on the heels of last Friday’s disappointing jobs report. Bad news for the economy is often good news for mortgage rates.
In a separate report the Labor Department showed that prices at the wholesale level of our economy rose by 2.9% on a year-over-year basis when you strip out volatile food and energy costs. This is on the higher end of the Fed’s comfort range but not terribly concerning for investors. Typically, inflation is the primary driver of mortgage rates so if this figure creeps higher in the coming months it could cause rates to inch higher. Tomorrow the Labor Department will release the Consumer Price Index which is a similar measure of prices at the retail level of the economy.
In light of recent weakness to some of the domestic economic data Fed Vice Chairwoman Janet Yellen reminded the markets on Wednesday evening that the Fed may consider further support designed to keep long-term interest rates low should the economic recovery falter. As I stated in yesterday’s ‘rate update’ the current level of interest rates reflects an expectation for another round of quantitative easing. If the Fed fails to act on this expectation it would cause mortgage rates to rise.
I still think rates are likely to worsen from these levels than improve so will keep my locking bias.
Current Outlook: locking