Weak Data, Trade Optimism Hold Rates Steady

Mortgage rates held steady over the past seven days as disappointing economic data releases were mostly offset by modest optimism surrounding trade.

Last week’s full slate of economic news was highlighted by Thursday’s larger-than-expected decline in a widely watched indicator of the service sector, pushing rates down sharply. The news showed that a slowing manufacturing sector has begun to negatively affect the larger services sector, evidence that the economy is facing stronger resistance than previously estimated.

In the days since, rates oscillated in a range close to a three-year low. Trade-related developments continue to shake markets, especially in weeks like this that are light on economic data. Amid increasing tension between the U.S. and China, trade discussions did see some progress this week, and rates nudged up slightly as a result.

It’s likely that larger swings for mortgage rates are on the horizon as key consumer-related data releases – consumer sentiment on Friday and retail sales next Wednesday – are on deck.