Mortgage rates were flat this week, standing pat near their lowest levels since spring 2018 despite signs of market weakness and ongoing uncertainty at home and abroad.

The U.S. government shutdown has now entered its fourth week. As a result, markets have been forced to navigate a period of heightened economic uncertainty without the usual insights that government data typically provide. More than ever, financial markets must decipher private-sector and international data to gauge the temperature of the U.S. economy.

Rates slipped earlier this week on disappointing Chinese trade figures as well as a significant decline in factory output in the Eurozone. The discouraging international data reinforced fears of a global economic slowdown, making investment in the U.S. more attractive and putting downward pressure on mortgage rates. Inflation pressure in the U.S. remains subdued, even with historically low unemployment, which offered rates a nudge upwards earlier in the week. The decreased pressure also could put expected Federal Reserve hikes on ice in 2019.

Monetary policymakers have been very clear that they will be closely watching incoming economic data in making interest rate decisions, but with several of these data releases on hold until the federal government reopens, it has become particularly difficult to set expectations.

Until the announcement of a government re-opening, higher volatility but a net sideways trend in rates is likely to continue.