For the week of February 8th, 2021
Recap of last week: Rates slightly worse
Average mortgage rates worsened slightly through the week, pressured higher from moves taken by Congress to lay the groundwork for passing President Biden's large fiscal stimulus plan.
Mortgage Rate Forecast: Rates will remain low but could be volatile this week
Average mortgage rates could go either way this week, depending on how markets move. Stocks continue to push higher, and bonds may be pressured which could cause rates to worsen. Rates aren't likely to move too quickly though, and instead we will likely see small day-to-day movements in rebate pricing, the credit a lender provides towards closing costs based on what rate you choose, or the cost to obtain a lower rate (often called 'points').
What's affecting rates this week:
- Stimulus package: Talks surrounding Biden's $1.9 trillion relief package could pressure rates slightly higher.
- Economic data: Wednesday's inflation data and 10yr Treasury auction could cause some movement.
- Fed bond purchases: The Fed continues to buy Treasuries and mortgage bonds, helping to keep rates low and generally stable.
- Bond pricing: Lenders set mortgage rates based on the pricing of mortgage bonds, and we could see a little bit of improvement in bonds
