Mortgage rates rise to nearly 7%

The Street

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why mortgage rates are an issue for homebuyers.

Transcript

00:00I'm Conway Gittins reporting from the New York Stock Exchange.

00:02Here's what we're watching on the street today.

00:05It was a choppy session on Wall Street Wednesday as investors gear up for Friday's monthly

00:09jobs report.

00:10Meanwhile, Albertson's beat quarterly earnings forecast in a sign of confidence after an

00:15abandoned merger with Kroger, a supermarket chain raised its outlook for 2025.

00:21Looking ahead, the stock market is closed Thursday and the bond market will have a shortened

00:26session to mark the passing of President Jimmy Carter.

00:30Turning now to other headlines, 2025 is not off to a good start for prospective homebuyers.

00:37Mortgage rates have risen four weeks in a row, hitting highs not seen since July.

00:42The average rate on a traditional 30-year fixed rate mortgage came in at 6.99 percent

00:48last week, according to the Mortgage Bankers Association.

00:52With mortgage rates backing up to roughly 7 percent, some buyers are getting scared

00:55away.

00:56Higher mortgage rates have been sticky, despite the Federal Reserve cutting interest rates

01:01by a full percentage point in 2024.

01:05So why the disconnect?

01:06Mortgage rates are currently being driven by what the market thinks the Fed will do

01:11rather than what the Fed has already done.

01:14While the next Fed move is still likely to be a cut, how many more cuts is up for debate.

01:21In recent minutes from the Federal Reserve's December meeting, participants indicated that

01:26the committee was at or near the point at which it would be appropriate to slow the

01:30pace of policy easing.

01:33With pockets of inflation heating up again, the job market stronger than thought and uncertainties

01:38around Trump's future tax and tariff policies, investors now expect interest rates to stay

01:44higher for longer.

01:46And that likely means the same for mortgage rates.

01:50That'll do it for your daily briefing from the New York Stock Exchange.

01:53I'm Conway Giddens with the Street.

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