Mortgage rates and the 10-year Treasury yield have gone opposite ways. This is not normal.

Long Term Chart of Mortgage Rates vs the 10-Year Treasury

Change in Mortgage Rates vs Change in 10-Year Treasury Yield

Change Since August 6, 2020

• The 30-year mortgage rate is down 9 basis points
• The 10-year mortgage rate is down 23 basis points
• The 10-year US Treasury yield is up 72 basis points

The current divergence is more than a bit unusual.

What's It Mean?

1. Realistically, mortgage rates ought to be 75 to 100 basis points higher than they are.
2. The Fed via QE asset purchases is doing a far better job manipulating mortgage yields lower than it has done controlling yields on long-term treasuries.

On February 8, the Fed noted Monetary Policy Will Stay Accommodative For a Very Long Time. I commented, "Like Forever".

My question on February 14 still stands: How Long Before the Fed Tries to Manipulate Long-Term Rates Lower?