Last Week in Review: Home Loan Rates Decline Again
The coronavirus outbreak in China continued to grip the financial markets this week. The total affected and number of deaths rose sharply throughout the week suggesting the virus is not yet contained.
Stocks hate uncertainty and Bonds love uncertainty. As a result, Bonds traded higher to their best levels since October, pushing home loan rates lower to the best levels in three years.
It wasn’t all bad news this week though as economic readings here in the U.S. continue to show that our economy remains strong.
We also had a Fed meeting where the Fed left rates unchanged and did say the U.S. economy remains in a good place. Fed Chairman Powell also said the impact of the coronavirus on the global economy remains uncertain.
Over on Wall Street, corporate earnings overall have been very positive with Apple doing much better than expectations.
Bottom line: home loan rates will continue to be supported by the coronavirus uncertainty until they aren’t — meaning, the present quick decline in rates the past two weeks may prove fleeting should the coronavirus outbreak become more contained and less uncertain.