Mortgage rates moved lower today. For many lenders, it was the biggest drop in more than a month and it also brings them to the best levels in roughly a month. Others were more hesitant to make significant updates to today's rate sheets based on this morning's strength in bond markets (which underlie mortgage rates). If you're not seeing much of an improvement compared to yesterday at a specific lender, they're more likely to pass along that improvement if bond markets continue holding in current territory at the start of next week.
Just to be clear on how much improvement you might expect from a day like today, we're talking about roughly one quarter of 1 percent of the loan amount, expressed in terms of upfront cost. In other words, if your loan is $100k, then your upfront costs would have dropped by approximately $250 and your rate would have remained unchanged. For many borrowers though, today's improvement makes it possible to move down to the next lower interest rate. While this may mean upfront costs actually move a bit higher, that move would be offset by a 0.125% decrease in the rate itself (e.g. from 4.0% to 3.875%).
The catalyst for today's market movement was the Consumer Price Index--a key inflation report that plays a role in determining how aggressive the Federal Reserve might be in raising rates (or decreasing its monthly bond buying, which also has an impact on rates). When inflation is falling, or even if it's simply not rising as much as expected, rates tend to fall. At least that's true for stretches of time where bond markets are focused on inflation data, and 2017 is certainly one such stretch!
In the bigger picture, today's strength has a chance of confirming a shift back toward the lower rates that prevailed in the middle of the year. It definitely offered the strongest support of that possibility that we've seen since the most recent rate spike began in early September. At the very VERY least, it confirms that the aforementioned rate spike is over, and that's a victory even if rates don't subsequently surge back toward lower levels.
