2022 got bad Getting started in the bond market and thus mortgage rates. The pace was on the aggressive side with the average lender seeing an increase of over a quarter of a point in a week and 3/8 of a point in two weeks. The most popular 30-year fixed price is now in the 3.625% range, up from 3.25% at the end of December.
We’ve seen rates move higher and faster but very seldom. When that kind of momentum is underway, we slow down the proverbial vents and wait for some evidence that the sky is clear. This will usually take the form of smaller losses and eventually a push back in the other direction. The first two days of this week will probably have filled that role.
Yesterday it was a little more mysterious. Rates are at their highest since the pandemic began early today, but the bond market settle down By the end of the day. Today was a little more to encourage. Bonds are still falling in the morning, but less than yesterday. that they steadily improving From the mid-morning hours after testimony in Congress from Fed Chairman Powell.
In the bigger picture, today’s friendly bounce in the bond market No Anything special, but it provided a nice contrast to the weak AM. It also gave us the best example of a corrective bounce since the rate rally started in earnest last week. By the afternoon, nearly every bank issued positive requotes, offering lower rates compared to this morning’s initial offering. For context, this leaves the average lender significantly higher than Friday, but slightly better than yesterday afternoon.
The big question It is whether the worst is over now for this sudden move towards higher rates. The final answer is “Maybe!” It may be so “probably”. Unfortunately, this does not mean that rates cannot go up, simply that the pace may be moderate from here. Realistically, if it was possible to know what the immediate future holds for rates with any meaningful accuracy, then traders would already be trading accordingly. Thus the market is always doing its best to adapt to the expected future movement.
We have seen similar price hikes in the past that subsided for a few days before resuming. We’ve seen other examples where those few days were just the beginning of broader stability. that it It’s still so close To determine which version we are dealing with now.