Mortgage rates fell for the second week in a row during the week ending Thursday, Jan. 12, according to Freddie Mac's Primary Mortgage Market Survey.
The PMMS reported that:
The decline was in line with the direction of Treasury yields, which also slid 8 basis points, according to Freddie Mac. This is the second decline in the first two weeks of 2017, and the second time it's fallen since the presidential election.
Data from Bankrate also showed declining mortgage rates:
Weekly mortgage rates tend to fluctuate based on the most recent economic reports. The most recent jobs report, released Friday, Jan. 6, likely had an impact on residential mortgage rates during the week that followed.
The U.S. added 156,000 jobs in December 2016, according to the Bureau of Labor Statistics' Employment Situation Survey. This marks the 75th consecutive month of job creation. Though this is positive growth, it didn't meet many economists' expectations, The Wall Street Journal reported.
While job growth didn't quite meet the economists' hopes, there was some good news coming out of the report. Average hourly earnings jumped 2.9%. This is the biggest leap since June 2009 and a sign that the economic landscape is continuing to strengthen.
Though the number of jobs created was comparatively weak, the spike in hourly wages was a positive statistic that pleased economists. Following news of the increase in earnings, the 10-year Treasury yields followed suit, increasing 2.1 basis points, MarketWatch reported on Jan. 6.
However, the increase was short-lived, falling to its lowest point in six weeks on Thursday, Jan. 12, MarketWatch reported. This was sparked by President-elect Donald Trump's news conference.
Investors eager to hear Trump's insights and plans regarding previous mentions of deregulation, a focus on infrastructure and corporate tax cuts were disappointed when the subjects weren't addressed. As a result, Treasury prices grew. When these go up, Treasury yields go down, CNBC reported.
It's hard to predict how mortgage rates will change in the weeks and months ahead. According to Bankrate's Rate Trend Index, 54.5% of survey respondents predict rates will remain within one to two basis points of where they landed Jan. 12 in the coming week; 27.3% think they'll go down and 18.2% believe they'll go up.
Freddie Mac pointed out that the wage gains seen in December could continue, and if they do, mortgage rates will likely increase in the months ahead. Additionally, CNBC reported several Fed members indicated the possibility of further rate hikes in the coming year, likely pushing mortgage rates higher.
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