Mortgage Rate Update December 5, 2016

Mortgage rates are mostly unchanged from last week.

US stocks are starting the week off higher.  Typically, when stocks rally mortgage rates suffer.  Interest rates are modestly worse as compared to Friday but overall pretty even.

This week’s economic calendar is relatively light.  Therefore, I expect technical trading patterns to play an important role.  Currently the US 10-year treasury note is yielding 2.39% which is just above an important technical level of 2.385%.

If the yield can end the day at or below 2.385% I could see mortgage rates improving by .125%-.25% later this week.  If not, it would add strength to this technical level and I will shift to a locking bias.

That said, the next Fed meeting is scheduled for next Tuesday-Wednesday (13th-14th).  The markets are currently predicting a ~95% probability that the Fed will hike short-term interest rates.  As a reminder, the Fed does not directly set mortgage rates.  And in fact, a hike could actually help mortgage rates improve because they are anti-inflationary.

Current Outlook: floating