Mortgage Rates Finally Down

After many weeks of mortgage rates ticking up, last week they finally (incrementally) went down. The reason for this change in interest rates is that the economic data started to show more evidence that the high-interest rate environment was impacting inflation and the economy. This exactly what the Fed needs to see before pivoting. Factory orders fell more than expected, ADP employment was worse than expected, and unemployment rose.

Future Rate Cuts

The Fed chair, Jerome Powell, also delivered remarks to Congress last week. These remarks were generally well received by the mortgage market. He said, “if the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year.”

So, the good news is that rate cuts are expected. The uncertainty is the timing and the impact on long-term mortgage rates.

If you have any questions or are interested in discussing your mortgage needs, please contact us.