Mortgage rates reversed their recent trend, moving up last week.
Economic data releases last week were stronger than expected for both job growth and demand for services. These readings reduced market expectations for a near-term recession, driving mortgage rates higher based on forecasts for continued rate increases from the Federal Reserve. Data released this morning showed consumer prices increased 9.1% year over year – the highest rate in over forty years and more than markets expected. Even with this increase in inflation, markets remain volatile as investors try to balance Fed rate increases with recession risk, and rates are down slightly so far this week.
Additional economic data releases could result in further rate movements, with price information (producer price index, imports and exports), jobless claims and retail sales reports coming later this week.