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Mortgage rates rise only 0.01% on volatile bond market

Mortgage News Daily said lenders used some flexibility amid earlier week bond volatility, keeping average rates nearly flat versus the prior day.

Reported · Written up by our desk · Mortgages

Mortgage News Daily reports that average mortgage rates were only marginally higher despite losses in the bond market, with lenders ending the day just slightly above the prior session.

The outlet said mortgage rates are primarily driven by trading levels in mortgage-backed securities, but volatility earlier in the week created a timing mismatch. It noted that bond market improvement the day before implied a sharper drop in rates than what borrowers ultimately saw.

According to Mortgage News Daily, lenders have latitude in how they adjust rates when the underlying market is moving quickly, and in this case they adjusted more conservatively than the bond market would have suggested.

Mortgage News Daily put the bottom line at an average increase of 0.01% versus yesterday, and said rates were also broadly in line with levels seen on Wednesday morning before the Fed announcement.

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