The average 30-year fixed US mortgage rate jumped 19 basis points to 7.45% on Thursday. Mortgage News Daily recorded the move in its daily survey of brokers and lenders.
The jump tracks a broader selloff in US government bonds. For crypto markets, the Treasury yield at the center of that selloff carries the clearer signal.
Treasuries Drag the 30-Year Mortgage Rate Higher
The 30-year rate had sunk as low as 5.99% in late February, according to CNBC. It began rising once the Iran war started, then accelerated after the Federal Reserve (Fed) raised rates in September.
Mortgage News Daily Chief Operating Officer Matthew Graham traced the climb since September 10 to three drivers. He pointed to Fed commentary, higher oil prices, and stronger economic data.
However, Graham could not find a clear catalyst for Thursday afternoon’s bond selloff.
“No obvious catalyst. Explanations require concocting narratives and then defending them. There’s no objective, irrefutable way to connect the dots today. Sellers decided to sell… a lot,” he said.
That selloff matters because mortgage rates tend to track longer-dated Treasury yields. The 10-year yield closed at 5.18% on Thursday, up from 4.96% on Tuesday, according to the Treasury.
The Kobeissi Letter blamed inflation for the bond rout. It cited Brent crude above $105 a barrel and record diesel prices. It also noted consumers expect inflation near 4.6% over the next year.
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Crypto Pays the Price of Higher Yields
For crypto, the key link runs through those yields. When government debt pays more, holding Bitcoin (BTC) carries a higher opportunity cost.
That pressure showed on Wednesday. Bitcoin fell below $84,000 after strong US business activity data pushed the 10-year yield past 5%.
By Friday, BTC traded at $84,590, posting a modest gain over the past 24 hours, BeInCrypto Markets data shows. Altcoins moved faster in the rebound. Solana (SOL) gained 2.2%, and XRP (XRP) added 3.4% over the same period.
This leaves an open question. Can crypto buyers keep absorbing pressure from a Treasury market paying more than 5%?
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Source: BeInCrypto
