Mortgage rates were unchanged today, the the underlying mortgage-backed-securities (MBS) market was volatile. MBS have the most direct effect on mortgage rates of any financial instrument and they tend to move in concert with US Treasuries. When MBS prices move quickly during the day, lenders can recall previous rate sheets and publish new ones (referred to as a “reprice”). This happened a few times today surrounding the US Treasury Auction and the release of the Minutes from the Sep 17-18 FOMC Meeting.
Thankfully, positive and negative reactions were balanced enough that rate sheets remained broadly similar to yesterday’s with a few notable exceptions. On average, rates are unchanged. Conforming, 30yr fixed best-execution remains at 4.25%. Depending on your scenario and the lender, the costs involved with your quoted rate may have gone up or down from yesterday. Most lenders are so close as to not care, but a few have had bigger adjustments.
While there was rapid fluctuation between highs and lows in the underlying markets today, it all occurred in a vacuum relative to “pre-shutdown” trading. In other words, the government shutdown has sapped investors’ conviction to move very far toward higher or lower rates. As such, we’ve been essentially stuck in this range for 2 weeks, with only minor variations from day to day. If something changes this dynamic before the shutdown ends, we won’t know what it is until after it already happens.
Otherwise, it’s the pent-up economic data that will do the trick. Almost all of the data that would otherwise fuel market movement has been postponed due to the shutdown. It’s not even rescheduled yet, and won’t be until the shutdown ends.