With the economic expansion well underway, one big question remains: When will mortgage rates move toward 4% and higher?

Mortgage rates increased toward 3.25% in mid-February from the recent all-time lows of 2.625% at the start of the year, but then retracted to around 3.0% currently. The bond market in 2021 has been above 1.60% for a brief time, with a recent high of about 1.75%. These yields align with my AB (America is back) economic recovery model, which predicted that the 10-year yield should create a range from 1.33% to 1.60% in 2021.

I was very bullish on the economic recovery last year and bearish on the bond market; my peak forecast of the 10-year yield for 2021 was 1.94%. The question is, why are the bond market and mortgage rates still acting like the economy is in a low-growth phase with not much inflation?