In the ideal home-buying scenario, you’d have plenty of time to find the perfect home. However, this is not always possible. Maybe you are relocating for a job and have to buy a house from
Offsetting Influences On Rates
Mortgage rates have had to contend with a wide range of mixed news over the past week. Concerns about an upcoming election in Italy were positive, while rising oil prices and stronger-than-expected U.S. data were negative. These influences were roughly offsetting, and mortgage rates ended the week with little change.
An upcoming vote in Italy appears to be very close and has become a source of concern for investors. Next Sunday, voters will decide on a referendum designed to speed up lawmaking. If the referendum fails to pass, it likely would lead to a period of political uncertainty in Italy. It likely also would postpone critical reforms for the Italian banking sector, which in turn might put some Italian and other European banks at risk of failing. Investors have reacted to the uncertainty by shifting to safer assets, including U.S. mortgage-backed securities (MBS). This added demand for MBS was good for mortgage rates early in the week.
On Wednesday, OPEC representatives announced that they were closer to a deal to cut oil production. This resulted in one of the largest single-day price increases of the year. Higher oil prices are viewed as negative for mortgage rates, primarily because they raise expectations for future inflation.
Nearly all of the recent U.S. economic reports have exceeded expectations.Notably, Consumer Confidence jumped to the highest level since 2007. Reports on the labor market, manufacturing and income all contained upside surprises as well. Since stronger economic growth raises the outlook for future inflation, the recent data was negative for mortgage rates.
David is a seasoned real estate professional, specializing in residential sales, rentals and investment properties. David is a 15 year resident of the New Jersey Gold Coast, with the local knowledge n....
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