Mortgage rates fell to new 6-month lows

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Mortgage loan rates agitated just below again today – continuing the steady stream of improvements that began following the Fed’s announcement last week. The average lender can now quote regular 30-year fixed rates that are at least as low as mid-July. In most cases, today’s offerings are slightly better.

IN details may vary quite a bit depending on the scenario (buy / return, credit, prepayment, etc.), but the best scenarios returned to the “high 2” within a few weeks. In almost all cases, today’s rates are the lowest since early February.

What happened to the refreshingly strong push back to historic lows? At the beginning of the year if you could only place one bet for rates, “higher” makes more sense than “lower”. This is actually a good bet anyway, as January 4th rates are still slightly better than today’s rates. On the other hand, we canceled the impressive rate hike in 2021. The main reason for this is covid, both broadly and in the short term, as the rise in the number of cases creates economic uncertainty.

IN less obvious The key reason is that the market knew the rates should be higher at the end of last year and may have gotten ahead of itself in the process (unless, of course, if the number of COVID cases has not changed since June, and if we had never heard of the delta variant, it might be a different story.)

There are also supporting actors. Most notable are the economic data. The sum of economic reports over several months can help the Fed understand its bond buying policies and communications (which is an important factor for rates). Rest of the week gifts increased risks and opportunities in this regard, as several major economic reports will be released. Tomorrow 2 of the 3 remaining important reports (ADP employment and ISM Non-Manufacturing) will be released. Headliner – Friday morning with an official government employment report.

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