Rates Played Chicken With The Fed (And Lost)
Mortgage rates hit 5 month lows last week but quickly jumped to the highest levels in more than a month this week. While last week's strong jobs report certainly served as a catalyst, there's more to the story.
Fortunately, the story is fairly simple. It began in October when rates hit decades-long highs and finally began to make progress back toward lower levels. Inflation had been a pivotal component of the surge and inflation reports were starting to moderate in November and December. Simply put, a rate recovery made good sense.
In fact, lower inflation was desperately anticipated by financial markets. Interest rates , especially, had been on the defensive, waiting for a sign that the worst was over. Q4, 2022 arguably provided that sign, but there were serious questions t
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