October 5, 2023
Mortgage Rates Continue to increase
Markets sent September out on a high note as two-decade highs in interest rates have sparked buying last Thursday. Mortgage prices are about a point higher after last week’s “higher-for-longer” tone by the Fed sent mortgage rates up to about 8%. Weaker consumer and housing data yesterday started to change the bearish momentum behind the bond market’s recent sell off.
Yesterday, JOLTS Job Openings showed help wanted ads grew to 9.6 million; economists had expected a reading closer to 8.8… nearly one million lower. We’ll get more data on the employment market later this week with Friday’s release of the September non-farm payrolls report. Also earlier, Fed official Loretta Mester stated that she would support a November rate hike if the economy held steady –The Fed’s Raphael Bostic doesn’t expect a rate cut until late 2024. Several market participants, including Goldman, are sounding the alarm over the effect of higher rates on stocks…making it more expensive for companies to fund their business and rate capital for investing in infrastructure. The yield on the 10yr note is all the way up to 4.80%.