It was a remarkably quiet day for the mortgage market on two distinct fronts. Firstly, the average lender set rates this morning in line with yesterday’s latest levels. Additionally, there were very few changes throughout the day (and in those cases, rates improved modestly).
All of the above was made possible by the fact that the bond market remained at yesterday’s levels all day. This has now happened for two consecutive days, a kind of stability that seemed like a distant memory just a few weeks ago.
Will it last?
There’s no way to know for sure. The bond/rate market is constantly at risk of responding to several sources of stimulus. It just so happened that those sources remained silent following last week’s improvement.
It’s worth noting that there is a new Fed interest rate announcement tomorrow. Fed announcements often create interest rate volatility, and this volatility is rarely tied to whether the Fed raises/lowers/stays flat. For tomorrow, we already have a high degree of certainty that the Fed will not raise rates. Any Fed impact on mortgage rates will come down to the words they use in the policy statement or the words spoken by Fed Chair Warsh at the 2:30 PM ET press conference.
Aside from the Fed, there are still other potential considerations for interest rates (tech sector volatility, war-related headlines), but there’s no guarantee whatsoever that they will stick to a specific schedule.
