Mortgage rates remain much higher than they were at the end of February, but they did not move higher this week. Here’s a breakdown of what happened in the markets and what to watch going forward.
Rate Survey Clarification
Weekly surveys from the Mortgage Bankers Association and Freddie Mac reported sharply higher rates on Wednesday and Thursday, but these measurements lag current market conditions by several business days. The MBA averages the trailing five business days and publishes three days after that window closes, while Freddie publishes the next day. This creates a timing gap where much can change before publication.
Rate Movement Analysis
Mortgage rates peaked on March 27th at an index value of 6.64, then declined approximately 0.23% by week’s end. To put that in perspective: rates held inside a 0.23% range for the entire year up until March 11th.
The daily rate index updates in real-time and captures mid-day changes from multiple lenders, providing a more current snapshot than trailing surveys.
Market Drivers
Two primary factors influenced bond and mortgage rate behavior:
- Inflation expectations: Bonds decline (rates rise) when inflation expectations increase
- Economic weakness concerns: Bonds improve when economic slowdowns loom, offsetting inflation-driven rate increases
Oil Price Nuance
Markets distinguish between spot (immediate) oil prices and future-contract oil prices. This week, bonds responded more significantly to December oil futures prices than to current spot prices. This explains seemingly counterintuitive rate movements despite volatile oil headlines.
Geopolitical Events Timeline
- Wednesday night: Trump’s speech about potential Iran war escalation triggered rate and oil price spikes
- Thursday: News of Iran-Oman negotiations regarding Strait of Hormuz access supported rate recovery
- Friday: Stronger-than-expected employment data further supported bond markets
Economic Outlook
Inflation data will likely carry increasing importance in coming months as fuel price increases translate into broader consumer goods pricing. The March Consumer Price Index is scheduled for release, though most analysts anticipate oil-driven inflation will take time to appear in official measurements.
The current environment represents much calmer conditions compared to recent weeks, offering cautious hope, though the ultimate path of rates will depend on how geopolitical issues and the economy evolve.
Average Mortgage Rates
Mortgage News Daily
| Product | Rate | Change | Points |
|---|---|---|---|
| 30-Year Fixed | 6.43% | -0.02 | — |
| 15-Year Fixed | 6.01% | -0.01 | — |
| 30-Year FHA | 5.91% | 0.00 | — |
| 30-Year Jumbo | 6.60% | 0.00 | — |
| 7/6 SOFR ARM | 6.09% | +0.04 | — |
| 30-Year VA | 5.92% | -0.01 | — |
Mortgage Bankers Association
| Product | Rate | Change | Points |
|---|---|---|---|
| 30-Year Fixed | 6.57% | -0.31 | 0.65 |
| 15-Year Fixed | 5.89% | -0.22 | 0.75 |
| 30-Year FHA | 6.25% | -0.34 | 0.81 |
| 30-Year Jumbo | 6.59% | -0.29 | 0.43 |
| 7/6 SOFR ARM | 5.67% | -0.49 | 0.56 |
Freddie Mac
| Product | Rate | Change | Points |
|---|---|---|---|
| 30-Year Fixed | 6.46% | +0.25 | 0.00 |
| 15-Year Fixed | 5.77% | +0.30 | 0.00 |
Recent Economic Data
Tuesday, March 31
- January FHFA Home Prices (y/y): 1.6% (Forecast: 1.8%, Prior: N/A)
- January Case-Shiller Home Prices (y/y): 1.2% (Forecast: 1.3%, Prior: 1.4%)
- February JOLTS Job Openings: 6.882M (Forecast: 6.92M, Prior: 6.946M)
- March Consumer Confidence: 91.8% (Forecast: 88%, Prior: 91.2%)
Wednesday, April 1
- March ADP Jobs: 62K (Forecast: 40K, Prior: 63K)
- February Retail Sales: +0.6% (Forecast: 0.5%, Prior: -0.2%)
- February Retail Sales Control Group MoM: 0.5% (Forecast: 0.3%, Prior: 0.3%)
- March ISM Manufacturing PMI: 52.7 (Forecast: 52.5, Prior: 52.4)
- March ISM Manufacturing Prices Paid: 78.3 (Forecast: 73, Prior: 70.5)
Thursday, April 2
- March 28 Jobless Claims: 202K (Forecast: 212K, Prior: 210K)
Friday, April 3
- March Unemployment Rate: 4.3% (Forecast: 4.4%, Prior: 4.4%)
- March Non-Farm Payrolls: 178K (Forecast: 60K, Prior: -92K)
Upcoming Economic Data
- Tuesday, April 7: February Durable Goods: -0.5% (Prior: 0%)
- Wednesday, April 8: FOMC Minutes (scheduled release)
- Thursday, April 9: April 4 Jobless Claims: 209K (Prior: 202K); February PCE Prices (m/m): 0.4% (Prior: 0.3%); February Core PCE (y/y): 3.0% (Prior: 3.1%); Q4 GDP: 0.7% (Prior: 4.4%)
- Friday, April 10: March Core CPI (y/y): 2.7% (Prior: 2.5%); March Core CPI (m/m): 0.3% (Prior: 0.2%); April Consumer Sentiment: 52 (Prior: 53.3)
MBS and Treasury Pricing
| Security | Price/Yield | Change |
|---|---|---|
| UMBS 5.0 | 98.83 | +0.17 |
| UMBS 5.5 | 100.65 | +0.13 |
| 10-Year Treasury | 4.338% | -0.03 |
| 30-Year Treasury | 4.894% | -0.34 |
Pricing as of 4/6 1:31 PM EST
Recent Housing Data
| Metric | Value | Change |
|---|---|---|
| Mortgage Applications | 278.3 | -10.43% |
| Builder Confidence | 38 | +5.56% |
| Existing Home Sales | 4.09M | +1.74% |
| New Home Sales | 587K | -21.21% |
| Pending Home Sales | 70.9 | -1.25% |
Source: US Housing Market Weekly — Jay Bridges, Mortgage Lender, Priority Capital Corporation