The Monthly Treasury Average fell again and will likely fall below 0.30 percent this month. But the underlying data point to a higher index soon.
In February, the MTA was 0.30667 percent, based on an analysis of Treasury data reported by the Federal Reserve. Data back to 1953 indicate that this is the lowest the MTA has ever been.
The MTA has fallen each of the past 46 months. But that streak is likely to come to an end soon.
The index is determined by calculating a 12-month average of each month’s daily average for the one-year Treasury. The daily average was 0.29 percent in February, higher than 0.27 percent reported a month earlier.
Although the monthly activity suggests that the MTA might soon rise, that probably won’t happen until the index first falls below 0.30 percent — likely this month.
While the MTA is used as an index to determine interest-rate changes on some adjustable-rate mortgages, a much more widely used ARM index is the yield on the one-year Treasury.
According to Department of the Treasury data, the one-year yield slipped to 0.25 percent at the end of February from 0.26 percent at the end of January. On Monday, the one-year yield was back down to 0.25 percent.
ARM share was 0.926 percent in the Mortgage Market Index report for the week ended March 4, lower than 9.45 percent the prior week.