Mortgage rates fell today, erasing yesterday’s weakness in many cases. There were no significant events in the morning, but bond markets had already improved overnight in Asia and Europe. The improvements held throughout the US trading day, allowing lenders to offer improved rate sheets compared to yesterday. This keeps the most prevalently quoted conforming 30yr fixed rate for ideal scenarios (best-execution) at 4.375% whereas it had been in transit to 4.5% yesterday.
To make matters slightly more optimistic, Janet Yellen–the nominee to replace Bernanke as the head of the Federal Reserve–will have her confirmation hearing tomorrow in front of the Senate Banking Committee. Her prepared remarks were released late this afternoon and led to further strength in bond markets. It was late enough in the day that most lenders didn’t adjust rates sheets, though the gains seen in Mortgage-Backed-Securities would have justified it, had they happened earlier in the day. All other things being equal, this means tomorrow would start out with a bit of an advantage for mortgage rates. Even if rates simply hold steady, it would go a long way toward rejecting the trend higher that’s been in force for the past two weeks.