For the week of June 21, 2021
Recap of last week: Rates worsened
Average mortgage rates grew worse last week after unexpected comments from the Fed about inflation and asset purchases roiled markets. Rates rose slightly as mortgage bonds, the basis for mortgage rates, quickly lost ground on the news. Rates did show signs of improving to end the week though.
Mortgage Rate Forecast: Rates will remain low
Average mortgage rates this week could see some more volatility, meaning we could see rates and rebate pricing vary from day-to-day. Rebate pricing is the credit you get towards closing costs from your lender, or the fee you pay to get a lower rate, often called 'points'. However, rates will continue to remain low and could improve slightly this week.
What's affecting rates this week:
- Fed stimulus: The Fed continues to buy Treasuries and mortgage bonds, helping keep mortgage rates low. Talk about the Fed reducing bond purchases could pressure rates higher.
- Economic data: Later this week we will get more inflation data, which could cause some movement in rates.
- Fed speakers: Fed officials will be speaking this week, including Fed Chair Jerome Powell in front of Congress, and their comments could cause movement in rates as investors look for signs of future Fed actions.
