Markets can't seem to settle on which directions mortgage rates are heading, as investors attempt to decipher fast-moving and sometimes contradictory economic data.
After falling by over half a percentage point in the latter stages of last month to begin August under the 5% threshold, the 30-year fixed-rate average made sizable moves back and forth in the following weeks. Over the most recent seven-day period ending Aug. 25, the 30-year average headed back upward, leaping 42 basis points to 5.55%, according to Freddie Mac's Primary Mortgage Market Survey. A week earlier, it had
Reports showing key indicators trending positively applied upward pressure to interest rates over the past week, according to Paul Thomas, vice president of capital markets at Zillow.
"Economic data releases showed stronger economic activity than markets anticipated: continued tight labor markets, resilient consumer spending and strong manufacturing activity," he said in a research statement.
The 15-year fixed-rate average also saw a large surge upward, increasing to 4.85% from 4.55% week over week. One year ago, the 15-year rate came in at 2.17%.
Bucking the trend was the 5-year Treasury-indexed hybrid adjustable-rate mortgage, which decreased 3 basis points to 4.36% from 4.39% a week earlier. In the same weekly period a year ago, the 5/1 ARM was at 2.42%.
Despite
"Fed officials continue to message to investors that they are committed to getting inflation under control. Markets are reevaluating expectations about future rate increases and how high the Federal Reserve will raise rates, given that the economy appears to have less risk of contraction in the near term," he said.
Investors over the coming week will have their ears perked for news from the Jackson Hole Economic Symposium, where key leaders, including Fed Chair Jerome Powell are scheduled to speak. His comments "could provide further insight into near-term Federal Reserve policy," Thomas said. They also will be watching other key gauges of
Upward rate movements this year have led
"Home sales continue to decline, prices are moderating and consumer confidence is low," Khater said in a press release. "But, amid waning demand, there are still potential homebuyers on the sidelines waiting to jump back into the market."