Mortgage Rates are surging this week. Today’s upward pressure is being driven by HOT European Inflation Data which caused global bond yields to rise, which included US Mortgage Rates. While inflation in the U.S. has been moderating a bit recently, it has surged to record levels in Europe. The latest report from the European Union revealed a massive annual rate of increase of 8.9%, while the figures for the UK were an even higher 10.1%. Like the U.S. Fed, European Central Bank officials target an annual inflation rate of just 2.0%. Achieving this goal will be even more challenging in Europe, however, due to the steep increase in energy prices resulting from the conflict in Ukraine.
Looking ahead, investors will watch for Fed guidance on the pace of future rate hikes and bond portfolio reduction. Beyond that, New Home Sales will come out on Tuesday. Durable Orders, an important indicator of economic activity, will be released on Wednesday. The core PCE price index, the inflation indicator favored by the Fed, will come out on Friday. Fed Chair Powell is scheduled to speak at the Jackson Hole Conference on Friday as well.
SOURCE & AUTHOR |
Keith Murphy Branch Manager – Essex Mortgage NMLS #330827