Mortgage rates trend higher after Trump win

marketupdate

Lock Opportunity Remains in Midst of Uncertainty

Though Donald Trump’s election win on Tuesday sent shockwaves through the markets, things calmed down by morning as investors shook off early financial reactions to the stunning upset. Mortgage rates were up from previous figures, with the 30-year fixed posting 3.57% from its pre-election 3.47%, and the 15-year fixed trading at 2.86%, up .08%. These levels are still near historical lows, and with the uncertainty surrounding a President who has potentially disruptive plans for the Fed, it may still be a good time to lock in a low mortgage rate.

The pre-election probability of a December rate hike was 60%, and during Tuesday night’s chaos the figure plummeted to 30%. Currently, the market is pricing in a 56% chance of a rate hike in December, slightly lower than its original mark but far more optimistic than the overnight drop-off. Obviously, we’re going to be talking about the election results and their effect on the financial markets for a long time.

Trading volumes during the election were four times greater than the BREXIT vote, and to be sure, a lot of that trading volume came from Asia and central banks, which will have to trade defensively as they absorb the new American order on trade policy. Fast forward to this morning, and things aren’t nearly as grim. The DOW is trading flat, a total recovery from overnight losses. 10-year yields have also retracted hard, currently trading at 1.97%.

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