home buyers taking out a fixed 30year mortgage loan in recent days have a popular measure of inflation to thank for their lower rates but it’s too soon to assume rates will continue to tick down the interest rate on the 30year mortgage fell significantly in the wake of last week’s softerthanexpected consumer price index according to mortgage news daily which releases daily rate surveys of various home loans the average rate on a 30year fixedrate mortgage fell to 662 on nov 10 representing a drop of 60 basis points from the rate of 722 the previous day the retreat in rates resulted in an uptick in mortgage application volume last week the mortgage bankers association said in a thursday press release the volume of applications for a home purchase loan following adjustment for veterans day gained a seasonallyadjusted 4 from the week prior the association said the trade group’s weekly gauge of the average contract rate on a conforming 30year loan fell to 69 from 714 the drop has yet to be reflected in freddie mac ’s closely watched weekly survey which increased to 708 last week but the decline in daily rates appears to have held—for now the average rate on a 30year fixedrate loan on monday was 665 according to mortgage news daily rocket mortgage a large mortgage originator was quoting 30year fixed loans at 675 with 2125 points on tuesday midday—a dip of 125 percentage points from the day prior freddie mac’s average rate this week is expected thursday morning in a year marked by rapid mortgage rate increases the drop could save buyers some money on loan financing compared with recent levels the buyer of a 400000 home would save roughly 120 a month by taking out a 30year fixedrate loan at 665 compared with 722 the relief in rates for home buyers follows last week’s consumer price index report prices rose less than expected in october leading to a bond rally that lowered the 10year treasury yield with which mortgage rates often rise by about 3 percentage points the 10year yield was about 382 midday on tuesday after the producer price index another inflation measure came in softer than anticipated gauges of inflation and economic strength have remained major drivers of home financing costs as the federal reserve has sought to fight inflation through tighter monetary policy the drop in rates following october’s inflation report comes as investors watch for signs that the fed might slow its shortterm rate hikes “the market is so hungry for the fed to pivot” says john toohig raymond james’ head of whole loan trading “i personally think it’s a bit premature” the next clear read from the fed on the direction of its monetary policy will come following the coming meeting of the federal open market committee or fomc in middecember until then expect rates to be volatile with movements tied to economic releases “i think as we get closer and closer to that december date you’ll see rates trickle back up” he says “everything will hang on powell’s press release” bonds aren’t the only assets rallying in the wake of october’s coolerthanexpected inflation readings housingrelated stocks have also seen a boost two exchangetraded funds that track the homebuilding industry the spdr sp home builders etf xhb and the ishares us home construction etf itb were up about 10 since wednesday’s close as of midday tuesday builder stocks will need more clarity on the course of monetary policy for a sustained rally barron’s wrote last week