After more than a year of either decreases or stable interest rates, the first hint of what is to come is upon us. For the past 2 weeks, other than for a slight pull-back on Friday, the yields on the 10 year Treasury Bond (and consequently the interest rates on mortgage loans) have been increasing. The interest rates are off now by .25% from their recent rates and about .375% off their recent lows. It does not appear that there will be a bounce back any time soon. In addition, when the Federal Reserve ceases buying Treasury Securities on Wednesday, we may see a slight additional increase (though a lot of that is already priced in). I don’t see huge additional increases in the next few weeks, but neither do I see decreases. Hopefully, with the continue weakness in the economy the interest rates will hold where they are now for most of the purchase market.
The Rate Increases They Are a Coming!