For the week of December 7th, 2020
Recap of last week: Rates remained low
Average mortgage rates last week remained low, and in some situations were slightly better than the previous week.
Mortgage Rate Forecast: Rates likely to remain low
Average mortgage rates this week will remain low, and are unlikely to move up or down much. Most movement will come in the form of better rebate pricing, the credit a lender gives you towards your closing costs or the cost to obtain a lower rate, usually referred to as 'points'.
What's affecting rates this week:
- Covid-19: An increase in covid cases and hospitalizations has some areas of the country going back to lockdowns or implementing business curfews. The effect will be bad for the economic recovery, helping to keep rates low for the near term.
- Economic stimulus: The Fed continues to buy Treasuries and mortgage bonds, helping to keep rates low and stimulating the economic recovery.
- Economic data: A couple of Treasury auctions, and some data on inflation later in the week could have a small effect on rates this week, but not much.
- Stimulus talks. Markets have priced in a stimulus package to get done this month, which put some pressure on rates and pricing due to added debt and more Treasury supply in the bond market.
