Mortgage rates moved substantially higher last week as traders reacted to Thursday's Initial Jobless Claims. The amount of new unemployment filing dropped below 4-week trend line is now at its lowest levels in a year.
Fewer unemployment claims coupled with increasing employee wages raised fears of inflation and inflation nearly always pushes mortgage rates higher.
This week is practically devoid of data but there are two key housing releases -- Thursday's New Homes Sales and Friday's Existing Home Sales -- that could move mortgage rates.
In addition, as investors look for higher returns, they siphoning money from their bond investments and moving it into the stock market which has seemed unstoppable as of late.
This, too, is placing sell-side pressure on mortgage bonds.
As mortgage bonds sell off, it pushes mortgage rates higher for homeowners. Expect traders to ride last week's wave until Thursday, at least.
If you're shopping for mortgages today, it may be prudent to lock your rate and avoid fighting the current rate trend.
