Four weeks of rate increases push the 30-year mortgage to a year-high
“The FOMC’s decision to hold the federal funds target at its current level, coupled with the three dissents at this meeting, with each of these dissenting members preferring to hike rates now, indicates that the Fed is likely moving into a hiking cycle soon,” Fratantoni told Mortgage Professional America.
“Markets are now expecting they could start hiking before the end of the year.”
CME FedWatch now prices in more than a 63% probability of a September rate increase. Deutsche Bank’s economists expect a total of 50 basis points in hikes by year-end. The 10-year Treasury yield, a key driver of mortgage pricing, stood at 4.66% at midday Thursday, up from 3.97% in late February before the Iran conflict drove crude oil prices and inflation expectations higher.
What brokers are watching
Jay Lessard, president and senior loan officer at Sonoran Lending in Arizona, said buyers are adjusting their mindset rather than waiting on rates.
“Rather than trying to time the market perfectly, they’re focusing on being ready when the opportunity presents itself,” Lessard told MPA.
