Mortgage rates rise for the first time in over a month as key economic reports reshape market outlook

0
48

[ad_1]

Mortgage rates rose after the strong employment report for July was released as the market begins to gauge the change in the position of the Federal Reserve.

30-year fixed rate mortgages averaged 2.87% for the week ending Aug 11, up 10 basis points from the previous week, Freddie Mac
FMCC, St.
-11.14%

reported on Thursday… For the first time in six weeks, the 30-year loan increased weekly.

15-year fixed rate mortgages increased by five basis points to an average of 2.15%, while 5-year fixed rate mortgages indexed by the Treasury rose by four basis points to an average of 2.44 %.


“After hitting their lowest point in six months, mortgage rates have risen in the past seven days as some key economic reports have changed the outlook for the market.”


– Zillow Senior Economist Matthew Speakman

Mortgage rates rose in line with the rise in bond yields, including an increase in the yield on 10-year Treasury bonds.
TMUBMUSD10Y,
1.242%

“After hitting their lowest point in six months, mortgage rates have risen in the past seven days as some key economic reports have changed the outlook for the market,” Zillow said.
Z,
-2.13%

ZG,
-2.38%

Senior economist Matthew Speakman said, adding that July employment data released last Friday was the main driver behind mortgage rate hikes this week. Other data also point to a record number of job openings as of June.

Economists view the positive developments in the labor market, as well as additional signs of rising inflation, as a prelude to a change in the position of the Federal Reserve System.

“For months, the Fed has said it will not consider tightening monetary policy until more significant progress is made in the labor market,” Speakman said. “Indeed, many Fed officials said they believe the slowdown in their asset buying program is likely to occur this fall, and strong jobs data lends more weight to those claims.”


“These factors also signal that autumn may be a busier season than usual as buyers seek to take advantage of improved market conditions.”


– George Ratiu, Senior Economist at Realtor.com

When it comes to home purchases, rates may be higher, but historically they are still low. “Low rates are fueling high activity at the end of the summer season, which has historically slowed down,” said George Ratiu, senior economist at Realtor.com.

Increasing rates will not necessarily lead to an immediate increase in costs for home buyers. The latest data from Realtor.com shows that the number of new home listings for sale continues to rise, which should reduce competition and price pressures that buyers face from inventory shortages across the country.

(Realtor.com is operated by News Corp.
NWSA,
-1.38%

a subsidiary of Move Inc. and MarketWatch is a division of Dow Jones, which is also a subsidiary of News Corp.)

“These factors also signal that autumn could be a busier season than usual as buyers seek to take advantage of improved market conditions,” Ratiu said.

[ad_2]

Source link