The 30 year mortgage rate fell to 6.67% from 6.69% last week, according to the source report. A year earlier, the average stood at 6.58%.
The report said mortgage rates do not track the Fed directly. Instead, they move mainly with mortgage-backed securities and longer-term Treasury yields, especially the 10-year yield. Last Thursday, the 10-year yield stood at 4.676%. It was at 4.643% in the latest reading, and it had closed near 4.71% on Monday.
30 Year Mortgage Rate Tracks Yields
The source said inflation worries looked less severe after Wednesday’s CPI and Thursday’s softer-than-expected PPI. As a result, Treasury yields moved lower. If that bond rally continues, the report said 30-year mortgage rates could move down from the current 6.67% level.
Earlier this year, rates briefly dipped below 6%. Freddie Mac recorded a low of 5.98% in the first quarter. Meanwhile, the 10-year yield hit a yearly low of 3.93%. With the current 10-year yield at 4.64%, that marks a rise of 71 basis points. The comparable 30-year mortgage rate is up 69 basis points.
15-Year Fixed Rate Also Eases
The 15-year fixed-rate mortgage averaged 5.96%, down from 6.01% a week earlier. A year ago, that average was 5.71%.
The source described mortgage rates as still high by historical standards. It added that the next key question is whether the bond rally can push rates toward 6.5% and later closer to 6%.
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Source: InvestingLive
