Mortgage rates might be volatile in June. A graph of them may resemble the cutting side of a handsaw, with sharp daily ups and downs. I predict that the average rate on a 30-year mortgage will be higher in the last week of June than in the last week of May.
Experience tells you that when the Fed raises short-term interest rates, then long-term mortgage rates will go up, too. But when the stock market takes a beating , that tends to depress mortgage rates. What if investors worry that the Fed’s aggressive rate increases will cause a recession soon? In that case, mortgage rates might not rise much, or they could even fall.probably will rise in June, but that’s not a sure thing. Meantime, we could see substantial bumps and dips day to day.
Lenders kept rates low and steady during this time, knowing they could easily find buyers for their loans. But the period of tranquility ended when the Fed announced in mid-December that it would quickly reduce its purchases of mortgage-backed securities at the beginning of the new year. Lenders didn’t wait until January for the Fed to follow through; they raised mortgage rates at the end of December, and kept raising rates into the spring.
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