"Mortgage rates have had a wild ride since Fed Chair Jerome Powell started talking at the Fed press event Wednesday, rising 15 basis points today. However, I think the bond market responded appropriately after the Fed meeting, and on Thursday morning. Why? Even though the Fed lowered rates, the tone of the press conference was not overly dovish. Additionally, economic data has shown improvement in several areas recently."
"Mortgage spreads got really good before the Fed meeting and then quickly reversed, making mortgage pricing wilder than usual to the upside. Typically, mortgage spreads have improved on days when bond yields rose, but that's not what happened in the last 24 hours. While housing permits were again negative on Wednesday, retail sales, jobless claims and the Philly Fed manufacturing index all performed well, making it difficult for the 10-year yield to remain at 4%."
The Federal Reserve lowered rates but delivered a not-overly-dovish press conference, contributing to a 15 basis point rise in mortgage rates and a 10-year yield near 4.10%. Mortgage spreads tightened before the Fed meeting and then quickly reversed, producing unusually volatile mortgage pricing. Recent economic indicators including retail sales, jobless claims and the Philly Fed manufacturing index performed well, while housing permits remained negative. A 2025 forecast anticipates the fed funds rate between 5.75% and 7.25% and the 10-year yield ranging from 3.80% to 4.70%. Year-to-date 10-year trading has largely stayed within that anticipated range.
Read at www.housingwire.com
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