Mortgage rates remained at record lows in the latest survey but inched higher last week. The MBA reports that the 30-year fixed-rate mortgage rose four basis points to 2.96% with 0.36 in points for the week ended February 5, 2021. The Market Composite Index, a measure of total mortgage loan application volume, declined 4%, the Purchase Index fell by 5%, while the Refinance Index decreased by 4%. Spokesperson Joel Kan said, "Mortgage rates have increased in four of the first six weeks of 2021, with jumbo rates being the only loan type that saw a decline last week."
The January inflation reading Consumer Price Index (CPI) rose 0.3% versus the gain of 0.4% expected while the Core CPI was unchanged and below the 0.2% expected. Year-over-year, the headline number rose 1.4%, unchanged from December while the Core rate came in at +1.4%, down from 1.6% in December. Inflation is presently tame but that could change by the first half of 2021. Core CPI strips out volatile food and energy.
The Biden administration's $1.9 trillion stimulus relief plan is gaining steam in D.C. and will most likely be passed in the next few weeks. The plan includes direct $1,400 checks for those Americans who qualify along with funds to open schools safely, help for small businesses and enhanced unemployment benefits. Also, there is $350 billion in funding assistance to several states.
Mortgage rates remain historically low. Inflation low, for now. Fresh stimulus gaining steam.
