Mortgage Rates Seeing Upward Pressure

After an off day yesterday with the markets closed in observance of President’s Day, the markets are back in business in the United States and we are seeing a mixed start for stocks and bonds. It is a very light day for economic data, a theme that continues for most of the week, but we are seeing some upward pressure on Treasury yields and subsequently, mortgage rates.

Where Are Mortgage Rates Going?                     

>>> Rates moving up a little today.

Financial market participants have returned to the workplace after the day off yesterday. It is a bit of a mix right now with stocks mostly lower and Treasury yields up slightly. The yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going) is back up at 2.90%.

We have seen it hit that mark during several trading sessions over the past week or so, but it has not been able to hold above that position for any sustained period of time.

There was a lot of talk last week about the 10-year yield surging above 3.00% – which is definitely a significant psychological threshold for investors. At the moment, there does not seem to be any clear threat of that happening, given that it is a very light week for economic data, but it is something to keep in mind for the near future.

We are dealing with a complete lack of economic data out today, and in the absence of such, investors and borrowers have to take their cues from other financial data such as the stock market, gold and oil prices, and maybe a rumbling from the Feds or the White House. There are a several bond auctions coming up, as well as the focus tomorrow will be on the FOMC minutes from their meeting a few weeks ago.

Rate/Float Recommendation           

>>> Lock in a rate soon.

Mortgage rates are up a little today, but nothing major. The long-term trend does remain, however, for them to rise considerably from present levels. Many analysts are still calling for rates to hit 5% at some point this year. In a rising rate environment, the decision to lock or float becomes complicated.  Obviously, if you know rates are rising, you want to lock in as soon as possible.