It's been a remarkably calm week for mortgage rates, and a fairly decent one relative to several recent examples.  The average top tier 30yr fixed rate hovered just over 7% for most of November before breaking back into the high 6% range at the beginning of last week.  Since then, there haven't been any "bad days" for the mortgage market, even if we're still a long way from the low rates of September. If rates can't be as low as we might like them to be, the next best thing is for them to be stable and they've done exceedingly well on that front.  Since last Friday, the average top tier 30yr fixed rate hasn't moved more than 0.02% on any given day.  Today was the least volatile as there was no change versus yesterday's latest levels. This little "ledge" in the high 6% range corresponds to a similar ledge in 10yr Treasury yields at 4.17%.  Both are arguably bracing for impact from tomorrow's big jobs report.  Said "impact" could either help or hurt, depending on the outcome of the data.  In general, the lower the job count, the better it would be for rates, and vice versa.

Mortgage lenders generally try to avoid setting rates more than once per day, but they will make changes if the underlying bond market is moving enough.  Mortgage Backed Securities (MBS) are the bonds that directly dictate mortgage rate movement.  When they're stronger/higher, it implies downward pressure on rates and vice versa. MBS started the day in weaker territory, which is why the average lender started the day by offering just slightly higher rates compared to yesterday's latest levels.  But MBS improved with the rest of the bond market after the morning's economic data was released. When MBS improved enough, many lenders revised their rates slightly lower than yesterday's latest levels. Technically, the average lender is at the lowest levels in over a month, but there's been very little change in the average since last Friday.  The following chart of MBS may help explain why.  Keep in mind that the higher the blue line is, the better it is for rates.  The red line shows the central tendency of the past few days of movement.  Bottom line, despite the ups and downs, MBS have been reasonably flat this week.

The bond market is the primary driver of mortgage rate movement and normally, "weakness" equates to higher rates.  Bonds are slightly weaker today compared to yesterday afternoon, but mortgage rates nonetheless managed to move lower.  What gives? Timing is partly to blame.  Bonds may be weaker than yesterday afternoon, but they're still stronger than yesterday morning, when most lenders publish their rates for the day.  After that initial rate offering, it takes a fair amount of bond market volatility before the average mortgage lender will make changes to mortgage rates.  Several lenders offered improvements yesterday afternoon in response to bond market improvements.  In those cases, their rates were fairly similar today.  Ironically, just as yesterday's volatility resulted in improvements for rates, today's volatility is doing the opposite with several lenders "repricing" to slightly higher levels. The net effect is an average rate that is just a hair below yesterday's, and also the lowest in just over a month. 

Mortgage rates remain elevated relative to the levels seen in September and early October, but they've definitely moved down a bit from their recent highs.  Thanksgiving week saw the lowest daily average rate in exactly a month, but there's never a guarantee the rate market will look the same on the following week.  Thankfully, it's almost perfectly unchanged this time around. The average lender is still able to offer top tier conventional 30yr fixed rates just under 7% for the 4th straight day.  There were no major sources of inspiration today, but that will change as the week progresses.  Friday's jobs report is especially significant. The same report has had the biggest impact of any economic report on multiple occasions in the past few months.

The interest rate market continues the healing process after taking heavy damage in October.  During the course of that month, the average top tier conventional 30yr fixed rate increased more than 0.75% and broke above 7.0% for the first time since early July.  The first few days of November saw some additional volatility with our rate index hitting 7.13% on November 6th. Things have calmed down more and more since then.  While this doesn't mean there's been a huge correction back toward lower levels, the absence of additional weakness is nearly as big of a victory as we could have seen.  Today's installment didn't bring a huge day-over-day change to mortgage rates, but we were already close enough to the 1-month low that a modest improvement is all it took. Rates take cues from bonds which, in turn, take cues from economic data, among other things. Today was the busiest day of the week for data, but none of it ended up causing a big move in one direction or the other.  Instead, bonds calmly continued toward stronger levels.  Be aware that this sort of movement at this time of the year can be a serendipitous byproduct of market motivations that don't have anything to do with the typical motivations.  That's an opaque phrase, to be sure, but a high detail explanation would require a novel, and it would be fairly esoteric to boot.  Suffice it to say that traders have to make certain trades before the end of the month, and most bond traders would consider that to be today.  It shouldn't necessarily be viewed as an indication of additional positive momentum.