Yesterday, we characterized the prevailing mortgage rate momentum as "broadly sideways," and while that's still very true in the bigger picture, words like "up" and "higher" might need to be sprinkled in this week. For those with a glass-half-empty approach, today's rates are the highest of the week and the highest since June 24th.  For the optimists (and, in our view, the pragmatists), today's rates are virtually identical to those seen on Tuesday.  Specifically, our 30yr fixed rate index is only 0.01% higher today--the smallest possible change. Motivation for movement in rates and in the underlying bond market was in short supply this week.  It would make more sense to view it as sort of hangover from last week's party (multi-month lows last Tuesday) followed by a wake up call at the end of last week from the stronger-than-expected jobs report. Bonds (which drive rates) care about big-ticket economic data and the jobs report is one of the biggest tickets. If there's a worthy competitor at the moment, it's next week's Consumer Price Index (CPI)--an inflation report that may or may not show the onset of tariff-driven inflation. Why would that matter?  First off, bonds simply don't like inflation and rates will generally be moving higher if inflation is moving higher. Additionally, the prospect of tariff-driven inflation is preventing the Federal Reserve from initiating rate cuts that would otherwise be justified by the current landscape of econ data and monetary policy.

Most of this week's mortgage rate movement has been an aftershock following last week's jobs report. That data sent rates quickly higher and that momentum has gradually faded over the past few days. In fact, yesterday finally saw an improvement.  Now today, things are minimally changed, depending on the lender. Most lenders issued at least one mid-day change yesterday as the bond market improved. Those lenders are sideways to slightly higher today, but not enough for the average loan quote to be detectably different from yesterday.  In a slightly broader context, rates are essentially sideways since Monday. In fact, our daily rate index is currently exactly where it was on Monday afternoon. In addition to being the least exciting outcome, it's also probably the most logical, given the absence of big-ticket news and economic data this week. Next week is a different story with the release of hotly anticipated inflation reports.

It's a bit of a stretch to refer to the past week as a "losing streak" for mortgage rates. The worst part about it was the consistency of upward movement starting last Wednesday. In terms of the  size of that movement, things have been less traumatic considering the average lender was still at the lowest levels since early April with the exception of the past 2 weeks. Perhaps it would be better-described as a "non-winning streak."  In any event, it's over. The underlying bond market was already showing signs that it was tired of pushing rates higher by yesterday afternoon. Now today, it's clear.  Bonds moved into stronger territory early and kept improving throughout the trading session (stronger bonds = lower rates, all else equal). The change erases all of yesterday's damage and a bit of Monday's as well.  Despite the improvement today, be aware that there is never a guarantee about the future when it comes to potential shifts in rate trends. An optimist might conclude that bond traders recognized a buying opportunity after this little push toward higher yields, but it will ultimately require rate-friendly economic data next week to solidify the positive message.  Conversely, if the data is un-friendly, it could spark another "non-winning streak," or worse.

Bad news first: mortgage rates have been moving steadily higher in July with the average top tier 30yr fixed scenario rising from 6.67% to 6.81% in just 4 business days.  This isn't an incredibly abrupt move, but it's slightly brisk compared to the average day of rate movement. The good news is twofold. First off, we often tend to see slightly brisk movement in the opposite direction after experiencing a consistent trend in the other direction. The month of June was arguably such a trend, and it took rates to their lowest levels in several months.  Secondly, and more simply, apart from the last few days of June, today's rates are still the lowest since late April.  [thirtyyearmortgagerates]

For the entire 2nd half of June, it was easy to be spoiled by the absence of volatility in mortgage rates. During that time, rates were either lower or unchanged every single day. The past few business days have been a different story. This began last Wednesday as the bond market began a small correction ahead of Thursday's big jobs report.  A correction is a normal occurrence that often follows an extended run in either direction. They can be as short as a single day or they can mark bigger picture turning points. We'll never know if last week's correction would have been a one day affair because the very next day, the jobs report continued pushing rates higher.  At that point, rate movement was no longer a correction. Rather, it was a response to economic data.  Now at the start of the new week, there's been some follow-through to last Thursday's rising rate momentum (Friday was closed for the 4th), carrying the average mortgage rate to the highest levels since June 25th. That's the bad news. The good news is that June 25th's rates were the lowest since early April at the time.