Mortgage Rates Recover Slightly But Remain Elevated
Today’s mortgage rate recap is largely similar to yesterday’s–not because the same things happened, but rather because the bigger stories and bigger movements had already taken place by yesterday. Today was more of an afterthought in terms of movement even if there are one or two potentially important takeaways.
Let’s talk about the movement first. It was modestly friendly, but not too big. To put things in perspective, yesterday’s rates were the highest in more than a month. Today’s were a close second. The average lender remains in the mid 6% range for a top tier conventional 30yr fixed scenario.
How about those important takeaways? Fair warning: this may be a bit abstruse for those who just want to know what rates did today.
Today’s takeaway is that the members of the Federal Reserve (aka “the Fed”) are as unified as ever when it comes to the belief that the market is too optimistic about a potential drop in inflation. One prominent Fed speaker even mentioned that the Fed’s policy stance would need to remain restrictive for “a few years” and that current policy was just barely getting into restrictive territory.
That’s a simple and sobering way to understand the Fed’s mindset. They’d rather create a bit of economic weakness than go easy on the fight against inflation. As ever, we’ll have to take them at their word that they’ll ease up if the inflation and economic data suggest the fight is over. Until then, rates will require a lot of convincing from data/inflation before making any major progress toward lower levels.