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Mortgage Rates Unchanged Again, But That's Less Likely Tomorrow

Mortgage rates barely budged today, with the average lender offering almost the exact same terms as yesterday.  That took some doing in the form of strength in the underlying bond market.  As of yesterday afternoon, bonds were at their weakest levels of the day, thus implying today's rates would be higher unless overnight market movement was much friendlier.  That's exactly what happened thanks to extremely weak economic data in Europe. 

Economic weakness promotes strength in the bond market, which in turn pushes rates lower.  Naturally, European data had the biggest benefit for European bonds, but there tends to be some spill-over between the world's biggest bond markets.  In today's case, the benefit to the US bond market was big enough to erase yesterday afternoon's weakness, thus preventing rates from moving higher. 

By comparison, today's trading session for bonds (during domestic hours) was much calmer than yesterday's.  That could change tomorrow as the European Central Bank (ECB) releases a policy announcement before US markets open for the day.  Like a Fed announcement, the ECB's decision on short-term rates and the verbiage it uses can have a significant impact on longer-term rates.  While that would be a bigger deal for Europe, that same spill-over potential exists, and it would be bigger than the overnight example today.

This Daily Mortgage Rate Update is provided in partnership with Mortgage News Daily.