Mortgage rates hit 2yr highs of 3.75% after Fed reiterates tightening stance despite stock selloff

Mortgage rates shot up to a 2 year high of 3.75% today. This came after a key Fed policy announcement and press conference.

The Fed said today it would stay on track to tighten overnight bank-to-bank lending rates, and also buy fewer bonds to keep long-term rates (like mortgages) to keep rates low.

The bond markets that set mortgage rates were perhaps expecting a less aggressive Fed tightening stance since. Why? Because stocks have been selling off all month, which can lead to a weaker economy if it continues.

But the Fed held the line for now, and rates spiked as shown in the real-time chart above from Mortgage News Daily (MND). See below for more on today’s market move from MND’s Matt Graham.

I’m also adding to other helpful links below. One explains what higher rates do to your monthly payments. The other explains how to calculate your home affordability.

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Reference:

– Rates Jump to New 2-Year Highs After Fed Announcement (MND)

– How Higher Mortgage Rates Impact Your Monthly Payment In Early 2022

– Here’s How To Calculate Home Affordability Yourself