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Have Rates Hit Their Highs?
May 9, 2024
Hello everyone. Welcome back to the Mortgage Rundown. Today we are going to talk about what’s happening with interest rates.
Last week we had another Federal Open Market Committee (FOMC) meeting where interest rates were left unchanged. The overnight rate from the Federal Reserve continues to sit in the range of 5.25 to 5.5% since July of last year. Not a lot came out of the meeting other than the appearance that the Fed will likely NOT raise rates from here and there is still a decent chance they drop rates one or two times before the end of the year.
That was enough to end a four-month losing streak for rates as the 10yr came off the high of 4.7% for 2024. Right now, the 10yr is a shade under 4.5% and we should see it trade in a tighter range until we get more data on inflation and the jobs market.
If you look at the chart on your screen you will see the 10yr over the past couple of years. The high was 5% in October of last year and the high for 2024 was that 4.7% mentioned earlier. Could this be the beginning of rates trending lower finally?
The Future of Rates
Looking ahead we do have CPI data coming out next week for April. We expect the headline number to be flat to slightly down and hopefully the core number does drop from last month. If that is the case, then this could be the beginning of a long slow drop in rates; with the high watermark for rates now behind us.
That’s it everyone from the capital markets desk this week. Thank you all for watching and have a great day.
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