Treasury yields are now rising at a rate to alarm investors who promptly backed off of growth stocks (whose performances would be most in jeopardy if central banks retaliate with tighter monetary policy). The 30- and 15-year fixed rate mortgages continue to move in tandem, both increasing by 16 basis points to settle at 3.16% and 2.60% respectively.
Inflation continues to be a concern as is the spread of COVID-19, which brought down consumer’s short-term outlook on business, income, and labor conditions. As a result, consumer confidence dropped from 113.8 to 109.3 instead of the predicted increase to 115.0. Housing prices followed a similar trend falling short of a 1.70% monthly increase as experts had anticipated. Month-over-month, prices only grew 1.55% in July compared to 1.79% in June. From a prospective buyer’s viewpoint, this is beneficial as decelerating prices plus reduced competition during the fall and winter months may be a “winning” combination for any offers they make. As far as rates go, the chances of a rate hike in 2022 is now 50-50 with more Federal officials escalating their predictions. Tapering is also likely to begin soon, which may also drive up rates.