- Housing News, Videos
- April 25, 2019
Promising Signs for Interest Rates Ahead?
Strong jobs. Subdued inflation. A healthy stock market. But what might the future hold?
Strong jobs. Subdued inflation. A healthy stock market. But what might the future hold?
Have you heard? The FOMC has confirmed that rates will stay constant with no increases ahead.
Interest rates for consumers and homebuyers have gone down. It's all a case of supply and demand.
Since our last update, there has been very little movement in the market, specifically interest rates. The 10-year currently sits just under 2.70% and as of right now volatility has been very low.
In the past 30 days, we've seen interest rates drop and drop. The 10yr, which recently traded as high as 3.24%, a level not seen since 2011, is down to 2.85%
Over the past month, we've seen rates hold relatively stable despite the uncertainty around the midterm elections. The 10yr is trading within the range of 3.05 and 3.25% and it’s currently at 3.15%. However, in the past year, rates are up about 80bps and it's generally believed the Fed will raise once more in 2018 and twice in 2019. A lot of that will depend on growth and inflation.
If it seems like interest rates have been going up almost every day, then you are correct. There has been this risk-off trade that has pushed stock and bond prices down. Investors are taking profits as there seems to be more and more concerns over valuations and the trade war with China.
For the last couple of weeks, we've seen interest rates creep up and up. The yield on the 10-year Treasury is now over 3%; something that hasn't happened very often since the financial crisis. The graph on your screen shows the 10-year for the past 8 years. What's interesting is the fact that the 10-year has not sustained a 3+% yield for 30 straight days since 2011.
Jason Obradovich, EVP of Capital Markets for New American Funding is back with the latest Mortgage Rundown. If you've been following the market, you may have noticed interest rates have slightly come down. What is going to happen to rates for the remainder of the year?