Economic Reports
Why Mortgage Rates Were Up for the Third Day in a Row
July 15, 2009 by James K Barath, CMPS · Leave a Comment
Mortgage markets worsened for the third straight Tuesday after the government reported June’s Retail Sales report came in slightly better than expected.
Since falling to near 5.000 percent last week, 30-year fixed conforming mortgage rates have risen by almost 3/8.
It’s a similar mortgage rate pattern to what we’ve seen over the last 10 months — rates drift down to near their “all-time lows”, and then surge higher over just a few days time.
This week’s movement, in particular, is vexing home buyers and would-be refinancers.
Many people thought mortgage rates would break below the 5.000 percent threshold. The markets, however, had other ideas.
In addition to the unexpectedly strong Retail Sales data, last month’s Producer Price Index reported higher than expectations, too.
A rising PPI is important to rate shoppers because the figure is akin to the Cost of Living measurement for household, but for American businesses instead. The thought goes that if business costs are rising, consumer costs will eventually rise, too, as businesses share their expenses with American households.
This is inflationary, of course, and inflation is awful for mortgage rates. It’s part of the reason why mortgage rates closed higher again Tuesday.
All year long, mortgage rates have been jumpy and unpredictable. This past week has been no different and it’s why you shouldn’t necessarily try to time for a market bottom with mortgage rates.
If an interest rate looks good to you today and the payment is manageable, consider locking it in. There’s no guarantee rates will ever fall back toward 5.
About the Author: James K Barath is a Certified Mortgage Planning Specialist, qualified liability advisor and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James Barath today for your Borrow Smart Analysis - the CALM Approach to Borrowing ! His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy! 