Mortgage rates moved quickly higher today following stronger-than-expected economic data. Rates are driven by the bond market. Bonds are safe-haven assets. When the economy is stronger, investors are less likely to to buy safe-haven assets. As demand for bonds drops, it's the same as investors demanding higher rates of return before buying. In other words, it all adds up to the end user needing to pay a higher rate.
Today brought the release of two economic reports and both were strong. First up was the 2nd revision of Q4 GDP. Investors were prepared for this to fall short of analysts' expectations due to the government shutdown and other year-end headwinds. Instead, it beat the forecast by 0.3% (2.6 vs 2.3 forecast). After that, a closely watched regional business survey from the Chicago Fed district sent the same message by easily beating its forecast.
In response to the data, underlying bond markets weakened--that is, they moved lower in price and higher in yield/rate. Many mortgage lenders were forced to adjust their rate sheet offerings accordingly. By the end of the day, the average lender was back up to rates last seen on February 15th.