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Highest Rates Since April, But There's a Catch

Over the past 30 days, interest rates have risen sharply. This is true for both mortgage rates and bond market benchmarks like 10yr Treasury yields. But another version of the 10yr Treasury yield continues to operate near all-time lows.
How can rates simultaneously be rising quickly but still near all-time lows?  Inflation! 
As we discussed last week, inflation erodes the value of bonds.  As such, bond yields frequently move in response to changes in inflation expectations (higher inflation = higher rates).  That correlation is easily seen in the following chart:…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.
Source: mortgagenewsdaily.comNew feed

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