Mortgage Market Update

Mortgage rates continued to climb last week as inflation continued to rise across the board. The Consumer and Producer Price Indices rose, with consumer inflation now running at 8.5%, its highest rate since 1981. Both import and export prices also continue to increase. The Russian invasion of Ukraine, China’s COVID lockdowns, and tight global supply chains add additional challenges to the inflationary landscape. While Retail Sales came in near expectations, Industrial Production blew past predictions. It now appears that the Fed will likely raise rates a half-point at its May meeting and will also begin reducing its massive portfolio of assets by reducing its reinvestment program. Until traders and analysts begin to believe that the Fed is catching up with inflation, we are likely to see mortgage rates continuing to move upward. This week holds scant market-moving data, but we will get a view into the housing marketing. Even with rates climbing and many housing data points moving downward, most experts believe that housing will remain strong for the rest of the year. - Shea Oliver, MyProNewsletter