Freddie Mac Chief Economist Frank Nothaft pointed to employment data in his assessment of why rates fell.
Next week, Freddie’s report is likely to be at least 10 BPS worse than today’s given the 10-year Treasury yield, which rose from 3.18 percent last Thursday to 3.23 percent during late trading Thursday, based on data reported by the Department of the Treasury and WSJ.com.
Half of the panelists surveyed by Bankrate.com for the week May 12 to May 18 agreed that rates will rise over the next week. No change was predicted by 44 percent of the panelists, while 6 percent saw rates falling at least 3 BPS.
The spread between the jumbo 30-year and the conforming 30-year was tighter in the U.S. Mortgage Market Index report from Mortech Inc. and MortgageDaily.com for the week ended May 6. The spread narrowed to 53Â BPS from 60 BPS last week.
A seven-basis-point improvement was recorded by Freddie for the average 15-year fixed-rate mortgage, which was 3.82 percent. The spread between the 15-year and the 30-year edged down to 81 BPS from last week’s 82 BPS.
The five-year, Treasury-indexed, hybrid adjustable-rate mortgage averaged 3.41 percent this week, 6 BPS better than last Thursday’s survey from Freddie.
Just 3 BPS below last week, Freddie said the one-year Treasury-indexed ARM averaged 3.11 percent in the latest report. The one-year was 4.02 percent in the same week during 2010.
At 0.18 percent on Wednesday, the one-year ARM index — the yield on the one-year Treasury — was a basis point lower than seven days prior, the Treasury Department data indicated. The six-month London Interbank Offered Rate, meanwhile, slipped to 0.42 percent from 0.43 percent last week, Bankrate.com reported.
The share of new activity attributable to ARMs in the Mortgage Market Index report eased to 10.45 percent from 10.79 percent for the week ended April 29.
