𝗥𝗲𝗰𝗮𝗽 𝗼𝗳 𝗹𝗮𝘀𝘁 𝘄𝗲𝗲𝗸: 𝗥𝗮𝘁𝗲𝘀 𝘄𝗲𝗿𝗲 𝘂𝗻𝗰𝗵𝗮𝗻𝗴𝗲𝗱

With traders taking the second half of the week off, average mortgage rates ended last week’s holiday week at basically the same as the previous week.

𝗠𝗼𝗿𝘁𝗴𝗮𝗴𝗲 𝗥𝗮𝘁𝗲 𝗙𝗼𝗿𝗲𝗰𝗮𝘀𝘁: 𝗥𝗮𝘁𝗲𝘀 𝘀𝗵𝗼𝘂𝗹𝗱 𝗿𝗲𝗺𝗮𝗶𝗻 𝗹𝗼𝘄 𝗯𝘂𝘁 𝗰𝗼𝘂𝗹𝗱 𝘀𝗲𝗲 𝘃𝗼𝗹𝗮𝘁𝗶𝗹𝗶𝘁𝘆

Rates aren’t in much danger of moving higher unless we see a change in this outlook. If markets see a reason for the Fed to be more aggressive again, such as a strong inflation report, then we would see rates creep higher again. However, if expectations remain the same, we should also see rates remain stable. Fed Chair Jerome Powell will be making a speech on Wednesday where he is expected to cement the expectations above. The Fed will go into blackout mode on Saturday and we won’t hear from any Fed members during the quiet period ahead of the Fed meeting December 13-14th.

There are two economic reports this week that could affect mortgage rates, the PCE inflation report and jobs data. It isn’t too likely that we will get any surprises on the reports that could push rates significantly higher or lower, but we could see some smaller movement. The overall outlook though is still good for rates, and that rates should remain stable heading into next month’s Fed meeting.

𝗪𝗵𝗮𝘁’𝘀 𝗮𝗳𝗳𝗲𝗰𝘁𝗶𝗻𝗴 𝗿𝗮𝘁𝗲𝘀 𝘁𝗵𝗶𝘀 𝘄𝗲𝗲𝗸:

TECHNICALS:

The UMBS 5.5 coupon (MBS or mortgage backed securities) at 100.95, +11bps on the day.

The 10yr Treasury yield at 3.68.