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Mortgage Rates Fall As Inflation Fails to Spook The Market

Inflation is one of the mortal enemies of interest rates.  If dollars in the future buy less stuff than they do today, investors need to set higher and higher rates on the money they lend in order to realize the same returns.  With that in mind, we’d be well within our rights to assume a surprisingly high reading on a key inflation report would push rates higher.  In many past instances, that’s exactly how things play out, but that’s not what happened today.
To be fair, markets traded according to conventional wisdom in the first 20 minutes after the inflation report was released.  But from that point on, the bond market rallied (i.e. bond prices rose and yields fell, thus implying lower rates for the mortgage market)….(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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