Mortgage rates

Bond traders now see a roughly 60% chance of an emergency quarter-point cut by the Federal Reserve within one week because of the market turmoil.

The 30-year fixed rate mortgage was at its lowest level since early February as the benchmark 10-year Treasury dropped under 4%.

But following the gross domestic product and personal consumption expenditures reports, Treasury yields and mortgage rates fell.

Even though the 30-year fixed rate mortgage is at its lowest level since mid-March, consumers are being cautious in returning to the market, Freddie Mac said.

With Americans suffering from high housing costs and declining supply, we cannot afford to watch a massive government-sponsored enterprise sit on billions in retained earnings.

Positive signs on jobs and inflation help drive the 10-year Treasury yield lower, and lead investors to forecast a short-term rate cut sooner than later, Freddie Mac said.

But economists seem to differ on what the latest movement in mortgage rates means for the summer home sales business.

Markets appeared to welcome signs of future rate relief, with the latest Freddie Mac average falling for the fifth time in six weeks.

The 30-year fixed-rate mortgage average dropped back below the 7% level as investors reacted positively to news the economy is slowing, Freddie Mac said.

Yields on the benchmark 10-year Treasury also rose in the past week as bond and note auctions got tepid responses from investors.