Mortgage rates up for the second week in a row

Happy Friday from Local Mortgage!

It was a busy week for mortgage markets. Continued concerns over the Middle East on top of the FED moving to a more neutral position moved mortgages up a bit. We will end the week at 6.125% for our very best 30-year fixed scenario.  

Mortgage rates surged Wednesday mostly on news of the possibility of a prolonged blockade of the Strait of Hormuz. Markets took this seriously because it involved conversations with oil executives to assess the impact of a prolonged blockade on domestic energy markets and fuel prices. Bond yields (which correlate with rates) and oil prices lurched higher after a White House official reiterated/corroborated the news.

And Wednesday’s FED meeting wasn’t overly positive for mortgage markets either. While the Fed didn't hike rates, 3 voters voiced their opposition to the wording of the Fed's statement because it tacitly implies the Fed is more inclined to cut rates vs hike them in the near future. Those 3 voters would prefer to indicate that rates could go either way depending on inflation and the economy.

Looking ahead, attention will remain fixed on the conflict in the Middle East. Investors also will monitor comments from Fed officials about future monetary policy. For economic data, New Home Sales, JOLTS, and the ISM national services sector index will come out on Tuesday. The key Employment report will be released on Friday, and these figures on the number of jobs, the unemployment rate, and wage inflation are always closely watched.

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