What Did Rates Do This Week?
Mortgage rates had a wild week as markets reacted heavily to ongoing geopolitical tensions and uncertainty surrounding the conflict in Iran. Early in the week, mortgage rates faced upward pressure as investors worried that rising oil prices and global instability could lead to higher inflation and keep interest rates elevated.
Toward the end of the week, however, the bond market finally started moving in a more positive direction for mortgage rates. Investors gained some renewed optimism that the conflict in Iran could eventually move toward a resolution or ceasefire, helping ease some inflation concerns tied to energy prices and global markets.
While volatility remains high, the improvement late in the week gave the mortgage market some much-needed relief and created cautious optimism heading into next week.
What to Look Forward to Next Week
Next week, markets will continue closely monitoring headlines related to Iran and global energy markets, as geopolitical news has become one of the biggest drivers of mortgage rate movement recently.
In addition, investors will be watching upcoming inflation and economic data for clues about the future direction of mortgage interest rates and Federal Reserve policy. Any signs that inflation is cooling or economic growth is slowing could help mortgage rates improve further.
However, markets remain extremely sensitive right now, and sudden news developments could quickly create additional volatility in both directions.
Lock or Float Bias
Our current lock bias remains cautiously neutral with a slight lean toward floating for borrowers with longer closing timelines.
The late-week improvement in mortgage pricing was encouraging, but markets are still reacting quickly to geopolitical headlines and inflation concerns. Buyers closing soon may still prefer the certainty of locking in their mortgage rate, while those with more time may choose to float and see if market optimism continues into next week.
As always, mortgage rate markets can change quickly, and working closely with your loan officer is the best way to determine the right strategy for your situation.
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