We sometimes note that a five-day streak of rising mortgage rates is a rare event that significantly increases the likelihood of at least a temporary decline. Longer streaks of increases certainly occur, but the likelihood of a decline increases sharply after eight days.
Taking all this into account, today marked the eighth consecutive day of improvement in mortgage rates.
Does this mean that interest rates are destined to rise tomorrow? Not necessarily. First of all, when it comes to the simple question of whether interest rates will rise or fall in a given time period, we cannot be sure that a particular outcome will necessarily occur.
Perhaps more interesting is the fact that the underlying bond market (interest rates are a driver of bond prices) has already seen a gradual pullback since last Thursday's inflation data — a pullback that was gradual enough that the average mortgage lender has been able to avoid raising interest rates since then.
Finally, rather than relying on precedents without context, we need to consider that interest rates are reacting to a small number of important economic reports. Tomorrow's retail sales data is one such report, although it is not at the same level as last week's inflation data. Simply put, there is no magic rule that will prevent a nine-day rise in a row if retail sales are significantly weaker than expected. Conversely, if the data is surprisingly strong, interest rates are more likely to rise, and this has absolutely nothing to do with the low likelihood of a nine-day rise.