For the week of February 27, 2023

Recap of last week: Rates moved higher

Mortgage rates crept a bit higher early last week, but did appear to be leveling off by the end of the week. Last Friday's inflation report showed inflation was still coming in higher than expected, stopping any chance of seeing rates improve to end the week.

Mortgage Rate Forecast: Rates not ready to drop

Although we are seeing some signs that rates could be stabilizing, it is still too early to tell for sure and we should be prepared to see them creep higher this week. Even if rates don't move much higher, it is extremely unlikely we see them move lower from here and leveling off could be considered a win for the week.

What's affecting rates this week:
- Economic data: A handful of reports this week could put pressure on mortgage rates if they show the economy is not slowing down.
- The Fed: Current mortgage rates reflect markets' belief that the Fed will raise its policy rate through June to a high of 5.25%. If markets grow concerned that the Fed will raise its rate more aggressively, we will see mortgage rates move higher on the speculation.
- Bond market: Rises in the 10yr Treasury yield, now close to 4%, pressure mortgage backed securities pricing which contributes to mortgage rates increasing.