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Mortgage rates hit 7.26% after 10-year yields jump to 2006 highs
The spike followed hot PMI data and more hawkish remarks from Fed governor Michael Barr, with mortgage spreads improving enough to limit how far rates could rise.
HousingWire reports mortgage rates climbed to 7.26%, the highest level this year, as a sharp rise in the 10-year Treasury yield pushed borrowing costs higher.
The outlet links the jump to strong U.S. PMI readings for both services and manufacturing, alongside a more hawkish tone from Federal Reserve governor Michael Barr. Barr, a voting member, said further policy adjustments are likely to be needed to ensure inflation returns to target, noting inflation is above the Fed’s 2% goal and that risks to reaching it have increased.
HousingWire adds that while oil prices rose by a few dollars and remain elevated, the move in mortgage rates was not mainly driven by oil today. The article also points to improved mortgage spreads that helped prevent rates from rising even further.
The report notes the 10-year yield reached a level not seen since 2006, and describes a market pattern where major yield moves have tended to cluster around payroll data and hawkish Fed comments. It cites the 10-year yield at 4.96% early in the day before it moved to a key resistance area around 4.14%.