April Market Rate Update
This month's Market Rate Update is arriving a bit later than usual - but that gives us the opportunity to reflect on both March and the first half of April.
Our Approach
For any new readers, our goal is to provide a politically neutral analysis, using historical rate data to identify trends and offer insights into where rates might head over the next 30 days. We primarily look at the 5-year US Treasury rate, as it closely parallels the commercial loan rate market due to most commercial real estate loans being written as 5-year balloon loans or 5/1 ARMs.
March Recap
March was a rather non-eventful month with interest rate volatility being the lowest we've seen since we began tracking them in January 2024. The 5-year US Treasury rates only moved 0.15% over the entire month, with the highest rates being 4.11% and the lowest rate at 3.96%.
April Activity
April opened with significantly more activity. In just the first 10 business days, the 5-year Treasury moved 43 basis points - from a low of 3.72% to a high of 4.15%. Despite this early volatility, the broader trend continues to show a gradual decline in average rates since January 31, 2025.
What's Next?
Based on the trajectory of rates, outside of any unforeseen economic or global events, we expect rates to remain within the same range seen so far in April but collectively settle in the lower range below 4.00%. If that happens, we anticipate commercial loan rates will follow. We predict the market to price a strong commercial real estate loan between 6.25% and 7.00%, though here at IAA Credit Union, that rate may be lower.
Time to Talk?
If you have a commercial loan that's set to reprice or mature soon, we'd love to discuss how we can help. At IAACU, we're committed to helping our members provide the best financial care. Contact our team today to discuss your financing needs and take advantage of market opportunities.
Read our March 2025 Market Rate Update.
*Rates from Resource Center | U.S. Department of the Treasury as of April 21, 2025
