Statistics confirming a tightening labor market and higher inflation convinced analysts that the Fed will raise interest rates by half a point next week. Mortgage lenders are not waiting for the announcement. The average 30-year fixed mortgage rate has shot up a quarter point (0.25%) in just the last week.
According to Bank Rate Monitor, the 30-year fixed rate stands at 8.19% as of Monday evening. The 15-year fixed and one-year adjustable rates jumped to 7.86% and 6.83% respectively, while the 30-year jumbo climbed to 8.50%.
Negative sentiment pushed Treasury bond yields to near 3-month highs on Monday. The yield on the benchmark 10-year note rose to 6.57% while the 30-year bond yield increased to 6.25%.
Stocks were mixed, with the Dow Jones Industrial Average managing a gain of 25.77 points while the Nasdaq dropped 147.44 points.
