•  Tuesday’s mortgage rates should be approximately .625 - .750 of a discount point higher than Monday’s early pricing. The bond market is currently down 18/32 (4.66%).

 •  Stocks are also showing losses with the Dow down 150 points and the Nasdaq down 345 points.

 •  There is no economic data or major headlines driving this morning’s trading. It appears simply to be the situation we referenced in Sunday evening’s weekly preview.

 •  Last Friday’s sell-off in bonds pushed the benchmark 10-year Treasury Note yield to its highest point in almost exactly a year. The next resistance point after 4.60% is 4.68% from January of 2025.

 •  After bonds opened slightly in positive ground yesterday (pushing yields lower), intraday weakness bumped the 10-year yield above the 4.6% resistance level before closing just below it. This morning’s selling has the yield now well above that level and closing in on last January’s high of 4.68%.

 •   If 4.68% fails to hold, the next level of resistance is 4.87% set back in October of 2023.

 •  This trend in yields is very troublesome for mortgage shoppers because rates tend to track bond yields. Meaning as yields continue to move higher, so will mortgage rates. Rates are not based precisely on what the 10-year Note yield is, but the factors that drive bond yields higher cause mortgage bonds to also lose value, leading to higher rates.

 •  Unfortunately, it doesn’t look like we can expect much relief in the immediate future unless there is solid and reliable progress in ending the Iran war and bringing oil costs lower that eases inflation.

 •  Tomorrow’s only scheduled events relevant to mortgage rates will come during afternoon hours.

 •  First will be the results announcement of the 20-year Treasury Bond auction at 1:00 PM ET. Good news would be the benchmarks showing there was strong demand for the securities, particularly from international investors. An indication that investors still have an appetite for long-term debt would be favorable for mortgage rates because rates are based on long-term securities.

 •  The release of the minutes from the last FOMC meeting will follow at 2:00 PM ET. Of particular interest is discussion about the direction of inflation, employment stability, and how the Iran war is affecting the economy. Those are factors that will determine if the Fed’s next move is raising key short-term interest rates or if they will continue to hold them at current levels for the foreseeable future.

 •  Fed discussion that leans towards raising key rates would be considered bad news for bonds and likely lead to an upward revision in mortgage pricing tomorrow.

 • Visit our Daily Commentary page on our site for detailed explanations on current news that is relevant to mortgage rates.

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If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.