Mortgage Rates Fall For Sixth Straight Day

Mortgage Rates Fall For Sixth Straight Day

Aug 28 2014, 3:45PM

Mortgage rates fell modestly for an impressive sixth straight day today.  Yet again, we’re seeing little attention paid to the events in the US that NORMALLY influence interest rates.  Case in point, stronger economic data typically pushes rates higher, and three out of three economic reports were stronger than expected today.  The dark horse market consideration continues to be Europe.  Specifically, expectations for further accommodation from the European Central Bank combined with real economic deterioration in the Eurozone are motivating record low rates in European bond markets and US markets are interconnected enough to get some of that benefit.

We talked about this in more detail on Tuesday: (Read More: How Long Will Low, Flat Mortgage Rates Last?).

The cumulative effect of the 6 days of improvement brings rates even closer to their lowest levels of the year.  The most prevalently-quoted conforming 30yr fixed rate for top tier borrowers remains 4.125%, BUT we’re about as close to 4.0% coming into play as we have been all year.  It’s worth noting that on the past 2 occasions that rates have entered this territory, they moved higher shortly thereafter.  The third time could always be the charm, but if you have a short term time horizon, the risk of floating still outweighs the reward.  Longer term time horizons have more room for personal preference as it will take a major change in markets before we could rule out further progress based on the Europe effect.

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