Mortgage rates receded for the third week in a row as financial markets reacted to a handful of economic news.
The consumer price index grew 2.1 percent, the quickest rate in five years, signaling that inflation is creeping up. The Federal Reserve released its “beige book,” a collection of anecdotal information on the economy, which indicated the economy was growing at a modest rate. Federal Reserve Chair Janet Yellen said Wednesday she expects interest rates to rise “a few times per year” through 2019.
Long-term bonds went on a wild ride this week as yields plummeted on Tuesday before bouncing back Wednesday. The yield on the 10-year Treasury, one of the more reliable indicators of where mortgage rates are headed, fell to 2.33 percent, its lowest level since late November. The next day, it rebounded to 2.42 percent, its biggest one-day gain since Dec. 9.
With the financial markets likely to remain uncertain for the near future, mortgage rates are expected to be just as unpredictable.
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