For the week of October 25th, 2021
Recap of last week: Rates slightly worse
Average mortgage rates last week got slightly worse as markets continued to adjust to higher inflation and a steadily improving economy, as well as the likelihood that the Fed will start removing some of the monetary stimulus that has kept rates low throughout the pandemic.
Mortgage Rate Forecast: Rates should remain low
Average mortgage rates are likely to remain relatively unchanged this week, ahead of next week's Fed meeting. We may see some opportunity to get better rebate pricing early in the week, before some of the economic data later in the week. 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'.
What's affecting rates this week:
- Economic data: GDP data on Thursday and consumer spending data on Friday could have a small effect on rates this week.
- Inflation concerns: Concerns about inflation are still pressuring mortgage rates.
- Fed stimulus: The Fed continues to buy Treasuries and mortgage bonds, helping keep mortgage rates low. However, rates are creeping up as investors prepare for the Fed to reduce the amount of bonds being purchased, with expectations that tapering could start in November.
