Good Thursday morning from your Hometown Lender,

A little data today.

Unemployment claims were slightly better than expected. Philly Fed Manufacturing was very weak. With the data being minimal, as expected, rates are holding in their respective trading channels. The 10yr note is at 4.42%. Tomorrow brings consumer sentiment, but I am not sure that will move the needle either. Next week, we do get some data, but we also have a very shortened week with lots of empty trading desks because of the Thanksgiving Holiday. I expect the volatility will be exaggerated.

Matt Graham shared some pearls of wisdom…

Remember October and the first part of November–not because of the election, but rather because of the relentless rise in mortgage rates?  Would you rather forget?  You’re not alone.  It was the fastest rate spike since 2022, and it was made all the more memorable because it put an end to the first real uptick in refinance activity in just as long.

In the days following the election, there was quite a bit of volatility in rates, but with the benefit of hindsight, we can say that the volatility has subsided.  Tuesday, November 12th was the last time rates made a decently big day-over-day move.  Since then, we haven’t seen top tier 30yr fixed rates change by more than 0.04% in either direction.  More impressively, they’ve held a range of only 0.06% during that time.  That’s a low volatility environment by any standard.

Today fit perfectly in that narrative with the average lender only moving up 0.01%.  After adjusting for upfront costs,  30yr fixed rates remain just over 7

Any time we’re marveling at the absence of volatility, a word of caution is in order.  Volatility can come back any time.  Its return can be driven by surprises or by scheduled data.  At the very least, we can be sure that the scheduled data in the first two weeks of December has immense potential to reignite volatility, for better or worse.

Stay safe and make today great!!