Mortgage interest rates and The Bund

As you may have noticed mortgage interest rates have moved higher in recent weeks.  For both purchase interest rates and refinance interest rates were seeing across the board increases for all fixed rate products.  Adjustable rate mortgages have seen virtually no adjustments during this period.  30 year fixed to 10 year fixed have all seen increases as California refinance loan volume continues to be moderate.  So what’s going on?

Now that the Fed news is old news we can look at the Bund – the German equivalent of the U.S. 10 year treasury.  It seems our treasury market is following the Bund and has actually had some influence for weeks now.  Up one day; down the next….just like the Bund.  And while Mortgage Backed Securities don’t always follow the moves of the treasury market; lately they have and this is one of the reasons why we’re seeing such mortgage interest rate volatility.