Rates Drop on Ceasefire News

Happy Friday from Local Mortgage!

It was a better week for mortgage rates. As expected, after the announcement of a temporary ceasefire in the Middle East, mortgage rates improved, coming back down to 6.00% for our best 30-year fixed conventional scenario.

News of a two-week ceasefire caused oil prices to decline sharply on Wednesday. This reduced future inflationary pressures, which was positive for mortgage rates. Concerns about the durability of the ceasefire will linger for weeks to come, but for now, rates are easing back towards where we were before the war began.

In economic news, inflation was in the spotlight this week. Thursday’s PCE price index for February showed a 3% year-over-year increase, down just a bit from 3.1% in January. Friday’s CPI for March showed a massive 0.9% increase from February, the largest increase since June of 2022. This elevated reading matched expectations as investors were braced for the effects of rising oil prices.

Headline news regarding the war in the Middle East will continue to be the market mover, especially since next week is a light economic news week with just the Producers Price Index due out Thursday.

Hope everyone has a great weekend, and thank you for reading!