The average 30-year fixed-rate mortgage landed at 3.92% Thursday, July 27, down from 3.96% the week before, according to Freddie Mac's Primary Mortgage Market Survey.
The first week of July ended with an average of 3.96% and the second week ended at 4.03%. Increasing oil prices and 10-year Treasury yields both pushed mortgage rates higher at the beginning of the month, according to The Mortgage Reports.
The middle stages of the month brought falling residential mortgage rates. Federal Reserve Chair Janet Yellen noted that inflation hasn't risen to the central bank's stated goal of 2% just yet, NerdWallet reported. She went on to say that it was possible the Federal Open Market Committee would adjust policy during an upcoming meeting.
Investors responded by turning to bonds, which lowered Treasury yields and, in turn, mortgage rates as well.
The fourth FOMC meeting of the year took place July 25-26. To the surprise of few, the committee chose to keep the federal funds rate steady at a range of 1% to 1.25%.
Those who awaited news from the meeting were more focused on the Fed's plan to address the now-$4.5 trillion balance sheet.
This portfolio is a result of a recession-era strategy to boost the economy by buying billions of dollars in bonds. Now that the Fed is once again confident in the economy, it has decided it's time to normalize the balance sheet.
As investors waited for the Fed to emerge from its two-day meeting, some sold off their bonds, causing mortgage rates to inch upward, according to NerdWallet.
However, the only news regarding the Fed's plan for the balance sheet coming from the July meeting was that details are yet to come. Now, investors must await the next FOMC meeting, scheduled to take place Sept. 19-20.
On Thursday, July 27, the day after the FOMC meeting, mortgage rates edged back down, NerdWallet reported.
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