The current 30-year fixed mortgage rate average is 3.73%, an increase of 0.34% from the previous week, according to Freddie Mac. This increase is driven by the positive economic reports released recently, in particular the job numbers, which showed the economy added more than 1.4 million jobs in October and the unemployment rate dropped to 6.9%.
The Federal Reserve’s current policies are also playing a role in the rise in mortgage rates. Last month, the Fed cut interest rates to near zero and announced other measures to support the economy. This has had an effect on the bond market, which has seen yields increase, pushing up mortgage rates.
The recent rise in rates is good news for potential homebuyers as it shows the economy is recovering, but it has put some pressure on those who have been looking to refinance. Refinancing applications have been dropping steadily for the past few weeks, as higher rates cut into potential savings.
However, many experts believe the current rate trends are likely to continue. The Fed is expected to keep interest rates low until at least 2023, meaning bond yields are likely to stay low. This should help to keep mortgage rates low for the foreseeable future.
In summary, mortgage rates have been on the rise for the past few weeks as encouraging economic data has pushed yields in the bond market higher. The Federal Reserve’s policies, which have kept interest rates low, have also contributed to the increase. While this is good news for potential homebuyers, it has put some pressure on those looking to refinance due to the lower savings available. However, many experts believe the current rate trends are likely to remain for the foreseeable future, due to the Fed’s commitment to keeping interest rates low.
This article was contributed on Sep 22, 2023
