August 1st brought 10yr Treasury yields to the lowest levels since November 2016. The bond market movement was big and unexpected. The mortgage rates are lower. The word RECESSION feels stronger today than yesterday. Investors feel safer to invest in Treasury Bonds. Today, news about more trade tariffs and de-globalization push back the confidence on the success of the American economy.
Mortgage rates move accordingly on August 2nd. 30-Year FHA loan rates reached 3.25% a new low since Oct 2016. 30-Year Conventional loan rates reached 3.70% and 30-Year Jumbo loan rates reached 3.80% both the lowest since Nov 2016.
Also interesting was the fact that bonds/rates didn’t pay much attention to this morning’s big jobs report. Friday’s release of the July Employment Situation report did not cause any waves in the market, likely because the report stayed true to the established trend
What to expect?
Based on the Fed’s laundry list of concerns, the bond market (which determines rates) will be watching economic data closely, both at home and abroad, as well as trade-related concerns. The stronger the data and trade relations, the more rates could rise, while weaker data and trade wars will lead to new long-term lows.
Ted Rood, a Senior Originator, recommends: “locking August closing, and looking hard at September loans too”.
Learn the what are the current mortgage rates here.
Sources:
http://www.mortgagenewsdaily.com/consumer_rates/917792.aspx
https://www.mauldineconomics.com/frontlinethoughts/an-opportunity-in-the-chaos