Latest news with #Treasury yields
Wall Street Journal
3 days ago
- Business
- Wall Street Journal
Mortgage Rates Today, August 15, 2025: 30-Year Rates Drop to 6.57%
Factors influencing current mortgage rates Today's mortgage rates are influenced by economic and market conditions, as well as personal factors. The rate you're quoted by a lender might be higher or lower than the national average. Here are some of the items considered when calculating your mortgage rate: 10-year Treasury yield: Current mortgage rates, especially on a 30-year fixed-rate mortgage, are related to movements in the 10-year Treasury yield. Current mortgage rates, especially on a 30-year fixed-rate mortgage, are related to movements in the 10-year Treasury yield. Mortgage-backed securities: The rate investors earn on mortgage-backed securities also plays a role. Spreads between mortgage-backed securities and Treasury yields, as well as between what lenders offer borrowers and mortgage-backed security rates, impact current mortgage rates. The rate investors earn on mortgage-backed securities also plays a role. Spreads between mortgage-backed securities and Treasury yields, as well as between what lenders offer borrowers and mortgage-backed security rates, impact current mortgage rates. Investor sentiment: Perceptions about fiscal policy and economic conditions can affect how Treasuries move, as well as how much risk lenders feel comfortable taking on. Perceptions about fiscal policy and economic conditions can affect how Treasuries move, as well as how much risk lenders feel comfortable taking on. Personal credit history: The information in your credit report and your credit score influence your mortgage rate quote. The information in your credit report and your credit score influence your mortgage rate quote. Income: Lenders look at your income relative to your potential mortgage payment and other debts you have. If it appears you can handle your mortgage payments with relative ease, they feel more comfortable lending you money. Lenders look at your income relative to your potential mortgage payment and other debts you have. If it appears you can handle your mortgage payments with relative ease, they feel more comfortable lending you money. Down payment: Your mortgage rate might be lower if you make a larger down payment; often, the best results are when you put at least 20% down. Your mortgage rate might be lower if you make a larger down payment; often, the best results are when you put at least 20% down. Points paid: Mortgage points, also known as discount points, are fees paid upfront as a way to directly reduce your rate and lower your monthly payments. Each point, which represents 1% of your loan amount, can potentially reduce your rate by up to 0.25 percentage points. Mortgage points, also known as discount points, are fees paid upfront as a way to directly reduce your rate and lower your monthly payments. Each point, which represents 1% of your loan amount, can potentially reduce your rate by up to 0.25 percentage points. Loan term: A 15-year mortgage rate is usually lower than a 30-year rate. By choosing a shorter term, you might be able to get a lower interest rate, but your monthly payment might be higher. How to choose the right mortgage for your financial goals When considering a mortgage, review your financial situation and goals. Often, 30-year fixed-rate mortgages are chosen because they spread a large payment over a longer period of time, making monthly payments more affordable. Even though the loan costs more overall, it might be more affordable on a day-to-day basis. If your main concern is becoming debt-free sooner while paying less interest and you can afford a higher monthly payment, a shorter-term loan might make sense. Let's say you get a $350,000 loan. Here's what you might pay with different mortgage terms: 30-year loan (6.97%): Monthly payment of $2,321.51 and total interest amount of $485,744.05 Monthly payment of $2,321.51 and total interest amount of $485,744.05 20-year loan (6.74%): Monthly payment of $2,659.19 and total interest amount of $288,206.46 Monthly payment of $2,659.19 and total interest amount of $288,206.46 15-year loan (6.20%): Monthly payment of $2,991.45 and total interest amount of $188,461.10 Monthly payment of $2,991.45 and total interest amount of $188,461.10 10-year loan (6.16%): Monthly payment of $3,913.90 and total interest amount of $119,667.88 These scenarios don't include other costs, like insurance and property taxes, that you might also be subject to. It's important to consider those costs as well. For example, you might think you can afford the payments on a 20-year or 15-year mortgage, but once you add in other homeownership costs, your budget might feel tight. Don't forget other homeownership costs that might impact your monthly budget, including maintenance, repairs, utilities and other expenses that might be higher once you move into a house. When choosing a mortgage, the principal and interest payments aren't the only considerations. One strategy might be to choose a longer loan, but make extra payments to pay down the debt faster and reduce the amount of interest you pay. With this approach, you can choose to pay extra each month, but if you need to cut back due to emergency, you can revert to the required lower monthly payment with a lower risk of not being able to meet the obligation. If you lock into a shorter loan term with a higher payment, you can't scale back payments later without risking the loss of the home.
Reuters
4 days ago
- Business
- Reuters
Bessent says Japan 'behind the curve' in monetary tightening, in Bloomberg interview
TOKYO, Aug 14 (Reuters) - U.S. Treasury Secretary Scott Bessent said Japan is being late in handling monetary tightening during an interview with Bloomberg Television. Bessent also said that U.S. Treasury yields are feeling the impact of overseas developments, including from Japan and Germany. "There's definitely leakage from — the Japanese have an inflation problem," Bessent said in the interview. Bessent mentioned that he had spoken with Bank of Japan Governor Kazuo Ueda. "My opinion, not his — they're behind the curve. So they're going to be hiking," he added. The U.S. Federal Reserve should lower the policy interest rate at least by 1.5%, Bessent also said, suggesting the central bank execute the rate cut by 50 basis points in September.
Yahoo
4 days ago
- Business
- Yahoo
Bessent says Japan 'behind the curve' in monetary tightening, in Bloomberg interview
TOKYO (Reuters) -U.S. Treasury Secretary Scott Bessent said Japan is being late in handling monetary tightening during an interview with Bloomberg Television. Bessent also said that U.S. Treasury yields are feeling the impact of overseas developments, including from Japan and Germany. "There's definitely leakage from — the Japanese have an inflation problem," Bessent said in the interview. Bessent mentioned that he had spoken with Bank of Japan Governor Kazuo Ueda. "My opinion, not his — they're behind the curve. So they're going to be hiking," he added. The U.S. Federal Reserve should lower the policy interest rate at least by 1.5%, Bessent also said, suggesting the central bank execute the rate cut by 50 basis points in September. Sign in to access your portfolio
Yahoo
19-07-2025
- Business
- Yahoo
What if the Fed cut rates to just 1% like Trump wants? An analyst says it's ‘ludicrous' and may scare businesses
The federal funds rate currently sits at 4.25%-4.50%, but President Donald Trump has said it should go down to just 1%. A rate that low would boost inflation expectations and send long-term Treasury yields higher, but also send a signal that something extreme may be developing in the economy, according to a Wall Street analyst. Amid the White House's unrelenting pressure campaign on Federal Reserve Chairman Jerome Powell, President Donald Trump has not only demanded that the central bank to cut rates but to lower them all the way to 1%. The federal funds rate currently sits at 4.25%-4.50%, meaning a reduction of that magnitude would require a drastic move that goes well beyond the Fed's typical increments of a quarter point at a time (though it last cut by half a point in September). It's so extreme, Wall Street doubts it would actually happen, as it would trigger immense turmoil in financial markets and the economy. 'I don't think this needs to be taken too seriously, because it's so ludicrous, and in some ways cutting rates too low, too prematurely, too early would do exactly what you don't want to happen,' Jeffrey Roach, chief economist at LPL Financial, told Fortune. That's because long-term Treasury yields would spike as bond investors price in higher expectations for inflation that a 1% rate would stoke, raising borrowing costs for consumers and businesses. In addition, a rate that low is usually associated with an economic emergency like the COVID-19 pandemic or the Great Financial Crisis. So 1% may actually shock businesses into wondering if another calamity is lurking around the corner, prompting them to hunker down and wait rather than expand, Roach warned. 'As a big business owner looking at rates at 1% or 2%, I'm definitely saying, 'what do you know that I don't?'' he said. 'Hence I'm not going to respond by increasing capex and increasing operations to the company. I'm going to be even more concerned with what that signals.' A White House spokesman pointed to Trump's previous comments that the Fed always can and should raise rates again if inflation spikes after cutting them. For his part, Roach thinks there's probably room for rates to eventually drop to about 3.5% by the end of 2026, if inflation stays under control, and said Powell didn't raise rates soon enough when inflation was surged after the pandemic. Similarly, Infrastructure Capital Advisors CEO Jay Hatfield accused Powell of gross incompetence by being too late to raise rates but also blasted the idea of the Fed slashing rates to 1%. Treasury yields would initially drop in the immediate aftermath of a cut to 1%. But once inflation indicators start pointing higher, the fed funds rate would go back up to 4% to shrink the money supply, sending the 10-year yield to about 5%. After a mini-recession or a big pullback, the yield would end up around 3.75%. 'So it's horrible economic policy to do that,' he told Fortune. A fed funds rate around 2.75%-3% wouldn't stoke inflation or send the economy into a downturn, but keeping rates where they are now would trigger a recession, Hatfield added. A 1% rate, however, would require a massive expansion in the money supply. 'It's absolutely a ridiculous idea and will cause double-digit inflation,' he warned. This story was originally featured on Sign in to access your portfolio
