Mortgage Market Update/Purchase and Refinance Mortgage info

[Tamalewagon]

Tuesdays bond market has opened in negative territory following mixed economic data. The major stock indexes are showing moderate gains with the Dow up 59 points and the Nasdaq up 24 points. The bond market is currently down 4/32 (2.23%), but strength late yesterday should improve this mornings mortgage rates slightly if your lender did not revise pricing lower yesterday afternoon.

This morning had two relatively minor pieces of economic data posted. The first was Augusts New Home Sales at 10:00 AM ET that showed sales of newly constructed homes fell 3.4% last month. That size of a decline is due to an upward revision to Julys sales, but the number of transactions was still below expectations before the revision is applied. That makes the data good news for bonds and mortgage rates.

Septembers Consumer Confidence Index (CCI) was also posted at 10:00 AM ET, revealing a reading of 119.8 that was a bit stronger than the 199.4 that was expected. That variance is not enough to bring much attention. What makes the data negative actually, is a revision to Augusts reading. It was revised down from 122.9 to 120.4. Analysts were originally expecting to see this months reading fall 3.5 points, but the revision makes the decline much smaller. Therefore, we can consider the data neutral to slightly negative for bonds and mortgage rates.

Tomorrow has an important morning report scheduled along with an afternoon event that has the potential to affect rates slightly. Augusts Durable Goods Orders will be posted at 8:30 AM ET, which is the weeks most important report. It gives us an indication of manufacturing sector strength by tracking orders for big-ticket items at U.S. factories. Big-ticket products are items that are expected to last three or more years such as electronics and appliances. Analysts are expecting to see a 0.7% increase in new orders, indicating growth in the manufacturing sector. A decline should help boost bond prices and cause mortgage rates to drop tomorrow because signs of economic weakness make longer-term securities more appealing to investors. However, a larger increase in new orders would indicate a stronger than expected manufacturing sector that will likely help push mortgage rates higher. It is worth noting that this data is known to be quite volatile from month-to-month, so a slight or moderate variance may not affect mortgage pricing.

The Treasury will sell 5-year Notes tomorrow and 7-year Notes Thursday. They will tell us if there is an appetite in the markets for medium-term securities. If investor demand in these sales is strong, particularly from international buyers, the broader bond market should move higher, pushing mortgage rates lower. But a lackluster interest from investors could lead to bond selling and higher mortgage pricing. The results of the sales will be announced at 1:00 PM ET each day, so any reaction will come during afternoon trading tomorrow and/or Thursday.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Wednesdays bond market has opened well in negative territory due to weakness in overnight trading. Stocks are showing minor gains of 26 points in the Dow and 39 points in the Nasdaq. The bond market is currently down 19/32 (2.30%), which should push this mornings mortgage rates higher by approximately .125 of a discount point.

Todays only relevant economic report was Augusts Durable Goods Orders at 8:30 AM ET. The Commerce Department announced that new orders for big-ticket items such as airplanes, appliances and electronics rose 1.7% last month. This was stronger than the 0.7% increase that was expected, indicating strength in the manufacturing sector. However, this data is not what is driving this morning?s bond trading. The variance from forecasts that we saw this morning would be significant in many other releases. Not in this one though. This data is known to be quite volatile from month to month. In fact, a secondary reading that excludes more volatile transportation and airplane orders pegged expectations at up 0.2%.

We also have todays 5-year Treasury Note auction taking place today that may influence this afternoons trading. Results of the sale will be announced at 1:00 PM ET, so any reaction will come during afternoon hours. A strong demand for the securities could help boost bond prices and possibly lead to a slight improvement in mortgage pricing. On the other hand, a lackluster sale may fuel more selling that extends this mornings losses.

Along with the 7-year Treasury Note sale, tomorrow has two economic reports set for release. The first is the second revision to the 2nd Quarter Gross Domestic Product (GDP) at 8:30 AM ET. Since this data is aged now and the preliminary reading of the 3rd Quarter GDP will be released next month, I don't see this revision having much of an impact on the financial markets or mortgage pricing. The GDP is important because it is the total sum of all goods and services produced within the U.S. and is considered the best measurement of economic activity. It is expected to show that the economy grew at an annual rate of 3.0%, unchanged from last months estimate. The lower the number, the better the news it is for mortgage rates. However, unless there is a significant change in this reading, it likely will not influence mortgage rates.

The second is will be last weeks unemployment update, also at 8:30 AM. This report is expected to show that 275,000 new claims for unemployment benefits were filed last week, up from the previous weeks 259,000. Rising initial claims are a sign of employment sector weakness, so the larger the number of claims, the better the news it is for mortgage rates. Although, because this is only a weekly reading, we usually need to see a significant miss from forecasts for it to impact mortgage rates.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened in negative territory again as the overall negative tone in bonds continues. The major stock indexes are showing minor losses with the Dow down 13 points and the Nasdaq down 15 points. The bond market is currently down 4/32 (2.32%), which should push this mornings mortgage rates slightly higher than Wednesdays morning pricing.

Yesterdays 5-year Treasury Note auction went fairly well but not particularly strong. The benchmarks we use pointed towards an average level or slightly better interest in the securities. The bond market weakened a little after the results were posted yesterday. More relevant though is the fact that yesterdays results and reaction don?t give us much to be optimistic about in todays 7-year Note sale. Results of todays auction will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading.

The first of this mornings two economic releases was the second revision to the 2nd Quarter Gross Domestic Product (GDP) at 8:30 AM ET. It showed that the economy grew at a 3.1% annual rate during the April, May and June months. This was a tad stronger than the 3.0% that was estimated last month and what analysts were expecting to see. Because this data is so aged now and traders are much more interested in the current quarter?s growth numbers that will be released next month, the news has not had much of an impact on todays mortgage pricing.

Todays other report was last weeks unemployment update that revealed 272,000 new claims for unemployment benefits were filed last week, up from the previous weeks revised 260,000 initial filings and short of the 275,000 that was expected. This was somewhat good news for bonds and mortgage rates because rising claims is a sign of employment sector weakness. However, the fact that these figures still may be skewed from the storms has erased the little importance that they normally carry as only a weekly update. In other words, a non-factor in todays trading.

Tomorrow beings us two more pieces of data that may influence mortgage rates. The first is Augusts Personal Income and Outlays at 8:30 AM ET. It gives us an indication of consumer ability to spend and current spending habits. This is relevant to the markets because consumer spending makes up over two-thirds of the U.S. economy. Rising income generally indicates that consumers have more money to spend, making economic growth more of a possibility. That is negative news for mortgage rates because bonds tend to thrive in weaker economic conditions. It is expected to show an increase of 0.2% in income and a 0.1% rise in spending. If we see weaker than expected readings, the bond market should react positively, leading to lower mortgage rates tomorrow.

The second report of the day is the University of Michigans revised Index of Consumer Sentiment for September. The preliminary reading that was released earlier this month showed a 95.1 reading. Analysts are expecting to see a slight upward revision, meaning consumer confidence was a bit stronger than previously thought. Waning confidence is good news for bonds because consumers that are concerned about their own financial and employment situations are less likely to make a large purchase in the near future, limiting economic growth. Therefore, a lower than expected reading would be favorable news for bonds and should help improve mortgage rates.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

http://mymortgagestatus.info/miam/?...C1DA6772BB16EF0BCDD1552C1D8723251122B372523ED

 

[Tamalewagon]

Fridays bond market has opened in negative territory despite economic news that was more favorable than unfavorable. Stocks are mixed with the Dow down 22 points and the Nasdaq up 12 points. The bond market is currently down 4/32 (2.32%), but strength late yesterday should still allow this mornings mortgage rates to be approximately .125 of a discount point lower than Thursdays morning pricing.

Yesterdays 7-year Treasury Note auction went well with several benchmarks pointing towards strong investor interest. Bonds had already improved before results were posted at 1:00 PM ET, but did extend that move afterward. That led to many lenders improving mortgage pricing before the end of the day.

There were two economic reports posted this morning, beginning with Augusts Personal Income and Outlays at 8:30 AM ET. The Commerce Department announced that personal income rose 0.2% while spending increased 0.1%. These matched expectations, but a secondary reading that tracks consumer level inflation came in a little lighter than forecasts. That allows us to consider the data good news for bonds and mortgage rates.

Also released this morning was the University of Michigans revised Index of Consumer Sentiment for September. It came in at 95.1, falling short of the 95.3 that forecasts were calling for. This means surveyed consumers were slightly less optimistic about their own financial situations than earlier in the month. By theory, that is good news for bonds because waning confidence usually means weaker levels of consumer spending. However, this is only a small variance in a moderately important report. Accordingly, we have not seen much a reaction to the news.

Next week doesn?t have too many relevant reports scheduled, but most of what will be released is considered important or highly important. It starts with Septembers Institute of Supply Managements (ISM) manufacturing index late Monday morning. The week will close with the almighty monthly Employment report Friday. Look for details on all of next weeks releases in Sunday evenings weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Mondays bond market has opened in positive territory despite stronger than expected economic news. Stocks are reacting positively to the report, pushing the Dow higher by 70 points and the Nasdaq up 29 points. The bond market is currently up 3/32 (2.32%), but weakness in trading as last week came to a close will keep this mornings mortgage rates near Fridays morning pricing.

The Institute for Supply Management (ISM) posted their manufacturing index at 10:00 AM ET this morning, announcing a reading of 60.8. This was an increase from Augusts 58.8 and the highest reading since May 2004, indication manufacturer sentiment is rising. Analysts were expecting to see a decline (58.0), meaning manufacturing activity was likely stronger than thought last month. That makes the report bad news for bonds and mortgage rates.

Tomorrow does not have any important data scheduled, the only day of the week that doesn?t have something relevant to mortgage rates. We have only three more monthly reports coming this week, but one of them is a key release. In addition to the data, there is also a high number of speaking engagements by Federal Reserve members that always draw attention and can influence rates.

Overall, the single most important day of the week is Friday due to the release of the monthly Employment report. Tomorrow has the best chance to be the calmest day unless something unexpected happens. Besides the relevant economic data set for release three days of the week, the fairly full Fed speaking schedule can also cause volatility in the markets at any time. This leads me to believe that we will see an active week for mortgage rates. Accordingly, please maintain contact with your mortgage professional if still floating a rate and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Tuesdays bond market has opened slightly in positive territory with little to drive trading this morning. The major stock indexes are mixed with the Dow up 48 points and the Nasdaq down 2 points. The bond market is currently up 2/32 (2.33%), which should improve this mornings mortgage rates just a little.

There is no relevant economic data being released today. If we see a noticeable change in bonds or an intraday revision to mortgage pricing, it likely will be a result of stock movement. If stocks remain near current levels, mortgage rates should follow suit. Generally speaking, stock gains tend to pressure bonds and lead to higher mortgage rates.

Tomorrow has one piece of economic data that is worth watching. That will be Septembers ADP Employment report at 8:15 AM ET. It has the potential to cause some movement in the markets if it shows much stronger or weaker numbers than expected. This report attempts to track changes in private-sector jobs, using ADPs payroll processing clients as a base. While it does draw attention, it is my opinion that it is overrated and is not a true reflection of the broader employment picture. It also is not accurate in predicting results of the monthly government report that follows a couple days later. Still, because we have seen reaction to the report, we should be watching it. Analysts are expecting it to show that 145,000 new payrolls were added. The lower the number of jobs, the better the news it is for mortgage rates.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[boatnam2]

Thanks for helping my girlfreind out today.

 

[Tamalewagon]

Thanks for helping my girlfreind out today.

My pleasure. I was wondering who sent her my way. :thumbsup

Many thanks.

 

[Tamalewagon]

Wednesdays bond market has opened fairly flat as traders look towards more important events later in the week. Stocks are mixed with the Dow up 17 and points and the Nasdaq down 6 points. The bond market is currently down 2/32 (2.33%), which should keep this mornings mortgage rates at yesterdays early levels.

Septembers ADP Employment report was posted at 8:15 AM ET this morning, showing 135,000 new private sector jobs were added last month. This was a little weaker than the 145,000 that was expected, making the data good news for bonds and mortgage rates. However, it was not far enough from forecasts to cause much concern in the markets. That means we have not seen mortgage rates have much of a reaction to the report.

Tomorrow has two piece of economic data set for release. The first is last weeks unemployment figures at 8:30 AM ET. They are expected to show that 265,000 new claims for unemployment benefits were filed last week, down from the previous weeks 272,000 initial claims. This report usually does not cause much movement in the markets or mortgage rates unless it shows a significant jump or drop in initial claims for benefits. The higher the number of claims, the better the news it is for bonds and mortgage rates since rising claims is a sign of employment sector weakness.

Augusts Factory Orders data will be released at 10:00 AM ET tomorrow morning. This Commerce Department report is similar to last weeks Durable Goods Orders release except it includes orders for both durable and non-durable goods. It is expected to show a 1.0% rise in new orders from Julys level. A large decline would be good news for the bond market and mortgage rates while a larger than unexpected rise would be bad news and could push rates slightly higher since it would indicate economic strength. It is worth noting though, that this report is not considered to be highly important to mortgage rates.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened in negative territory, erasing overnight gains. The major stock indexes are showing minor gains of 27 points in the Dow and 17 points in the Nasdaq. The bond market is currently down 7/32 (2.34%), which should push this mornings mortgage rates slightly higher.

The first of this mornings two economic releases was last weeks unemployment figures at 8:30 AM ET. They showed that 260,000 new claims for unemployment benefits were filed last week. This was lower than the 265,000 that was expected and a decline from the previous weeks 272,000. The drop hints that the employment sector was a little stronger than thought last week, making the data bad news for bonds and mortgage rates. Fortunately, this is only a weekly report and had little impact on this mornings mortgage pricing.

Augusts Factory Orders data was posted at 10:00 AM ET. The Commerce Department announced that new orders for both durable and non-durable goods rose 1.2%, slightly exceeding expectations of a 1.0% rise. The increase means manufacturing activity was a bit stronger than expected, making the report slightly unfavorable for mortgage rates. However, this mornings negative tone in bonds is not a result of this data.

This mornings bond weakness is being attributed to Fed talk that seems to support another bump to key short-term interest rates before the end of the year. The consensus is that it will come at the mid-December FOMC meeting. This should not have come as a major surprise, but we are seeing a negative reaction after what looked like was going to be a positive open for bonds.

Tomorrow brings us the release of arguably the most important monthly piece of economic news- the Employment report. The Labor Department will post Septembers employment stats early tomorrow morning. The report is comprised of many statistics and readings, but the most important are the unemployment rate, the number of new jobs added or lost during the month and average hourly earnings. Current forecasts call for no change in the unemployment rate, holding at 4.4%, an increase in payrolls of approximately 90,000 and a 0.2% increase in average earnings. Weaker than expected readings should rally bonds enough to improve mortgage rates, especially if the stock markets react poorly to the news.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

http://mymortgagestatus.info/miam/?...94CAFE3370BC3B9595A94754424BC0CC2A2DEDC1AE4CB

 

[Tamalewagon]

Friday?s bond market has opened well in negative territory following the release of a key economic report. Stocks are showing minor losses during early trading with the Dow down 11 points and the Nasdaq down 3 points. The bond market is currently down 12/32 (2.39%), which should push this morning?s mortgage rates higher by approximately .250 of a discount point.

This morning?s big news was September's Employment report at 8:30 AM ET. The release showed that the U.S. unemployment rate fell to 4.2% last month when analysts were expecting it to remain unchanged at 4.4%. The second headline number was the 33,000 DECLINE in payrolls, the first drop since September 2010. Forecasts were calling for approximately 90,000 jobs added to the economy. On top of that, August?s and July?s payroll numbers were revised to show a net loss of 38,000 jobs from previous estimates.

The lower unemployment rate is not good news for bonds and mortgage rates, but it doesn?t usually have too much of an impact on trading these days. The payroll number draws the most attention and the decline would normally be significantly favorable news. Unfortunately, the numbers are being attributed to Hurricanes Harvey and Irma. Their impact on the labor force is skewing the payroll figures and nobody can determine just how badly. Therefore, we aren?t seeing a favorable reaction in the bond and mortgage markets.

What the bond market is reacting to is the spike in average earnings. Today?s released showed a 0.5% rise in earnings, exceeding predictions of a 0.2% rise. The higher wages mean consumers have more money to spend, fueling economic growth. It also is an inflationary sign that makes bonds less appealing to investors and allows the Fed to bump key short-term interest rates sooner than later.

Next week brings us several reports that may influence mortgage rates in addition to a couple of Treasury auctions and the minutes from the most recent FOMC meeting. The bond market will be closed for the Columbus Day holiday while stocks will be trading. All of the week?s events take place from mid-week on, so the most movement in rates is likely to come the latter days. Look for details on all of next week?s activities in Sunday evening?s weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

This week brings us the release of four economic reports for the markets to digest over four trading days, most of which is considered important data. In addition to that data, there are two Treasury auctions that certainly have the potential to affect mortgage rates and the minutes from the last FOMC meeting. The bond market will be closed tomorrow in observance of the Columbus Day holiday as will most banks, so there will not be an update to this report tomorrow. The stock markets will be open for trading though. This means that the lenders that are open for business will likely not be issuing new rates tomorrow, opting to use Friday's pricing or not accepting new rate locks. The bond market will reopen for regular trading Tuesday morning.

The first release of the week doesn't come until Wednesday afternoon when the minutes from the most recent FOMC meeting will be posted at 2:00 PM ET. These may move the markets or could be a non-factor, depending on what they say. The key points traders are looking for are concerns over our and the global economies, inflation, reducing the Fed?s balance sheet and the Fed's next monetary policy move (rate hike). It is worth noting though that the last FOMC meeting was followed by revised economic predictions and a press conference with Fed Chair Yellen. Therefore, the likelihood of seeing a significant surprise in the minutes is relatively low.

Wednesday also has the first of this week's two important Treasury auctions. The sale of 10-year Notes will be held Wednesday while 30-year Bonds will be sold Thursday. We often see some weakness in bonds ahead of the sales as the firms participating prepare for them. However, as long as the auctions are met with decent demand from investors, the firms usually buy them back. This tends to help recover any presale losses. But, if the sales are met with a lackluster interest from investors- particularly international buyers, the bond market may move lower after the results are posted and mortgage rates may move higher. Those results will be announced at 1:00 PM each sale day, so any reaction will come during early afternoon trading.

Thursday?s sole monthly release is September's Producer Price Index (PPI). This index measures inflationary pressures at the manufacturing level of the economy and is considered to be highly important to the bond market. Analysts are expecting to see a 0.4% rise in the overall index and an increase of 0.2% in the more important core data reading. A larger than expected increase in the core reading could raise inflation concerns, pushing bond prices lower and mortgage rates higher. Inflation is the number one nemesis of the bond market because it erodes the value of a bond's future fixed interest payments. Unexpected growth in inflation also makes a Fed rate hike likely to be sooner than later. When inflation is a threat, even down the road, bonds sell for discounted prices that push their yields higher. And since mortgage rates tend to follow bond yields, this leads to higher rates for mortgage borrowers.

Friday has the remaining three economic reports, starting with September's Retail Sales report at 8:30 AM ET. This highly important data measures consumer level sales and is very important to the markets because consumer spending makes up over two-thirds of the U.S. economy. If consumer level spending is strong, overall economic growth is likely to be stronger, making bonds less attractive to investors. If we see weaker than expected readings in this report, the bond market should respond favorably and mortgage rates will probably improve Friday morning. Current forecasts are calling for a 1.6% increase in sales, although the sizable jump is being attributed to storm-related purchases. Good news for the bond market and mortgage pricing would be a much smaller increase.

Next up is September's Consumer Price Index (CPI), also at 8:30 AM ET. It tracks inflationary pressures at the very important consumer level of the economy and is one of the most important reports that the bond market gets each month. Analysts are expecting to see a 0.6% increase in the overall index and an increase of 0.2% in the core data. A larger than expected increase in the core reading could raise inflation concerns, pushing bond prices lower and mortgage rates higher.

The last release of the week will be posted by the University of Michigan late Friday morning. Their Index of Consumer Sentiment for October will give us an indication of consumer confidence, which helps us measure consumers' willingness to spend. If consumer confidence in their own financial situation is rising, they are more apt to make large purchases. But, if they are growing more concerned about their job security or finances, they probably will delay making that large purchase. This influences future consumer spending data and can impact the financial markets. It is expected to show a reading of 95.5, meaning confidence rose from September's level of 95.1. A decline would be considered favorable news for bonds and mortgage rates because waning consumer spending usually translates into slower economic growth.

Overall, it appears Friday is an easy label for the most important day of the week with two highly important reports being posted, although Thursday could be active also. Tuesday could be the calmest but following a three-day weekend in bonds we still may see some movement in rates. Please maintain contact with your mortgage professional if still floating an interest rate because this will probably be a pretty active week for the financial and mortgage markets.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Tuesdays bond market has opened in positive territory following the holiday weekend. The stock markets are also showing gains, pushing the Dow higher by 57 points and the Nasdaq up 9 points. The bond market is currently up 9/32 (2.33%), which should improve this mornings mortgage rates by approximately .125 - .250 of a discount point if comparing to Fridays morning pricing. The bond market was closed yesterday due to the Columbus Day holiday.

There is nothing of importance being released today. The rest of the week brings us four economic reports for the markets to digest over four trading days, most of which is considered important data. In addition to that data, there are two Treasury auctions that certainly have the potential to affect mortgage rates and the minutes from the last FOMC meeting.

Tomorrow doesn?t have an economic report scheduled, but does have the first of this weeks two important Treasury auctions. The sale of 10-year Notes will be held tomorrow while 30-year Bonds will be sold Thursday. We often see some weakness in bonds ahead of the sales as the firms participating prepare for them. However, as long as the auctions are met with decent demand from investors, the firms usually buy them back. This tends to help recover any presale losses. But, if the sales are met with a lackluster interest from investors- particularly international buyers, the bond market may move lower after the results are posted and mortgage rates may move higher. Those results will be announced at 1:00 PM each sale day, so any reaction will come during early afternoon trading.

Also tomorrow afternoon will be the release of the minutes from the most recent FOMC meeting. These may move the markets or could be a non-factor, depending on what they say. The key points traders are looking for are concerns over our and the global economies, inflation, reducing the Feds balance sheet and the Feds next monetary policy move (rate hike). It is worth noting though that the last FOMC meeting was followed by revised economic predictions and a press conference with Fed Chair Yellen. Therefore, the likelihood of seeing a significant surprise in the minutes is relatively low. They will be posted at 2:00 PM ET.

Overall, it appears Friday is an easy label for the most important day of the week with two highly important reports being posted, although Thursday could be active also. Please maintain contact with your mortgage professional if still floating an interest rate because this will probably be a pretty active week for the financial and mortgage markets.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Rates are trending lower this morning:

Wednesdays bond market has opened in positive territory with stocks flat and little to drive trading this morning. The major stock indexes are showing modest gains of 6 points in the Dow and 4 points in the Nasdaq. The bond market is currently up 6/32 (2.33%), but afternoon weakness yesterday should keep this mornings mortgage rates close to Tuesdays morning levels.

There is no relevant economic data being released today but we do have a couple of afternoon events that may affect mortgage rates. One will be the first of this weeks two important Treasury auctions. 10-year Notes will be sold today while 30-year Bonds will go tomorrow. We often see some weakness in bonds ahead of the sales as the firms participating prepare for them. However, as long as the auctions are met with decent demand from investors, the firms usually buy them back. This tends to help recover any presale losses. But, if the sales are met with a lackluster interest from investors- particularly international buyers, the bond market may move lower after the results are posted and mortgage rates may move higher. Those results will be announced at 1:00 PM each sale day, so any reaction will come during early afternoon trading.

Also this afternoon will be the release of the minutes from the most recent FOMC meeting. These may move the markets or could be a non-factor, depending on what they say. The key points traders are looking for are concerns over our and the global economies, inflation, reducing the Feds balance sheet and the Feds next monetary policy move (rate hike). It is worth noting though that the last FOMC meeting was followed by revised economic predictions and a press conference with Fed Chair Yellen. Therefore, the likelihood of seeing a significant surprise in the minutes is relatively low. They will be posted at 2:00 PM ET.

Tomorrows sole monthly release is Septembers Producer Price Index (PPI). This index measures inflationary pressures at the manufacturing level of the economy and is considered to be highly important to the bond market. Analysts are expecting to see a 0.4% rise in the overall index and an increase of 0.2% in the more important core data reading. A larger than expected increase in the core reading could raise inflation concerns, pushing bond prices lower and mortgage rates higher. Inflation is the number one nemesis of the bond market because it erodes the value of a bonds future fixed interest payments. Unexpected growth in inflation also makes a Fed rate hike likely to be sooner than later. When inflation is a threat, even down the road, bonds sell for discounted prices that push their yields higher. And since mortgage rates tend to follow bond yields, this leads to higher rates for mortgage borrowers.

The second release of the day will be last weeks unemployment update. This report is expected to show that 255,000 new claims for unemployment benefits were filed last week, down from the previous weeks 260,000. Rising initial claims are a sign of employment sector weakness, so the larger the number of claims, the better the news it is for mortgage rates. Although, because this is only a weekly reading we usually need to see a significant variance from forecasts for it to impact mortgage rates.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened in positive territory despite stronger than predicted economic data. Stocks are relatively flat with the major indexes are showing minor losses. The Dow is currently down 17 points while the Nasdaq has lost 7 points. The bond market is currently up 4/32 (2.33%), which should improve this mornings mortgage rates by approximately .125 of a discount point.

Yesterdays 10-year Treasury Note auction was pretty well received with a couple of benchmarks pointing towards strong interest in the securities. Bonds did improve yesterday afternoon, but it was long after results of the auction were posted. Therefore, it is difficult to correlate the move with the auction. However, it does allow us to be optimistic about todays 30-year Bond sale. If it also draws a decent interest from investors, we could see bonds and mortgage rates improve slightly later today. Results will be announced at 1:00 PM ET, so any reaction will come during early afternoon trading.

We also saw the minutes from the September FOMC meeting yesterday afternoon. They showed some disagreement amongst Fed members about lagging inflation and how soon it will reach the Feds preferred annual rate of 2.0%. However, the minutes also showed, despite the mixed inflation predictions, that a third bump to key short-term interest rates is all but a lock at this point. The consensus that another increase is ?warranted?, leaving market participants to predict it will come at December?s FOMC meeting. The bond market had little reaction to the news.

Septembers Producer Price Index (PPI) was released at 8:30 AM ET this morning. It showed a 0.4% rise in both the overall and core readings. The overall reading pegged expectations, but the core data that excludes volatile food and energy prices rose more than the 0.2% that was expected. The jump indicates inflationary pressures were a little stronger at the producer level of the economy than many had thought. Although, some of the jump can be attributed to hurricane-related costs. Still, because bonds become less appealing to investors when inflation is rising, we should consider this data slightly negative for mortgage rates.

The second release of the morning was last weeks unemployment update that showed only 243,000 new claims for unemployment benefits were filed last week. This was lower than the 255,000 that was expected and a noticeable decline from the previous week?s revised 258,000 initial filings. Since falling claims indicates a strengthening employment sector, this was also unfavorable news for bonds and mortgage rates. Fortunately, this is only a weekly release and had little impact on this mornings trading and mortgage pricing.

Tomorrow has three economic reports scheduled for release, two of which are considered highly important. The Commerce Department will start with September's Retail Sales data at 8:30 AM ET. This data measures consumer level sales and is very important to the markets because consumer spending makes up over two-thirds of the U.S. economy. If consumer level spending is strong, overall economic growth is likely to be stronger, making bonds less attractive to investors. If we see weaker than expected readings in this report, the bond market should respond favorably and mortgage rates will probably improve tomorrow morning. Current forecasts are calling for a 1.6% increase in sales, although the sizable jump is being attributed to storm-related purchases. Good news for the bond market and mortgage pricing would be a much smaller increase.

Next up is Septembers Consumer Price Index (CPI), also at 8:30 AM ET. It tracks inflationary pressures at the very important consumer level of the economy and is one of the most important reports that the bond market gets each month. Analysts are expecting to see a 0.6% increase in the overall index and an increase of 0.2% in the core data. A larger than expected increase in the core reading could raise inflation concerns, pushing bond prices lower and mortgage rates higher.

The last release of the week will be posted by the University of Michigan at 10:00 AM ET tomorrow morning. Their Index of Consumer Sentiment for October will give us an indication of consumer confidence, which helps us measure consumers willingness to spend. If consumer confidence in their own financial situation is rising, they are more apt to make large purchases. But, if they are growing more concerned about their job security or finances, they probably will delay making that large purchase. This influences future consumer spending data and can impact the financial markets. It is expected to show a reading of 95.5, meaning confidence rose from Septembers level of 95.1. A decline would be considered favorable news for bonds and mortgage rates because waning consumer spending usually translates into slower economic growth.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Fridays bond market has opened in positive territory again following mixed economic news. Stocks are showing gains, pushing some indexes to record levels. The Dow is currently up 46 points while the Nasdaq has gained 17 points. The bond market is currently up 6/32 (2.29%), which should improve this mornings mortgage rates by approximately .125 of a discount point if comparing to Thursdays early pricing.

Yesterdays 30-year Treasury Bond auction went well with several indicators pointing towards strong investor demand. The bond market did not have too much of a reaction to the news but we did see prices improve later in the afternoon. That led to a few lenders improving pricing before the end of the day. If your lender did revise lower yesterday afternoon, you should see less of an improvement in this mornings pricing than those whose lenders did not.

The first of this mornings three economic reports was Septembers Retail Sales data. The Commerce Department announced an increase of 1.6% in retail-level sales last month. That matched forecasts, but a secondary reading that excludes more volatile and costly auto transactions came in a little stronger than thought (up 1.0% vs 0.8%). Because stronger consumer spending fuels economic growth, we should consider the data neutral to slightly negative for mortgage rates. However, the data is believed to be skewed by storm-related purchases, minimizing the impact it has had on todays trading.

Septembers Consumer Price Index (CPI) was also posted at 8:30 AM ET. It showed a 0.5% rise in the overall reading and 0.1% increase in the more important core data. Both readings fell 0.1% short of forecasts, hinting that inflationary pressures were not as bad as thought at the consumer level of the economy. That makes the data slightly favorable for bonds and mortgage pricing.

The final release of the week came from the University of Michigan at 10:00 AM ET. They posted their Index of Consumer Sentiment for October, revealing a reading of 101.1 that was a surprise to many and a big move from Septembers 95.1 This means surveyed consumers were much more optimistic about their own financial situations this month than they were last month. That is bad news because rising sentiment usually translates into stronger levels of consumer spending.

Next week brings us a handful of relevant economic reports, but none are considered key or highly important. Monday has nothing scheduled that we need to be concerned with. Look for details on next weeks events in Sunday evenings weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Mondays bond market has opened in negative territory to start the week. Stocks are showing gains, pushing the Dow up 58 points and the Nasdaq up 26 points. The bond market is currently down 8/32 (2.30%), but strength late Friday should keep this mornings mortgage rates at Fridays morning pricing. If your lender improved rates intraday Friday, you should see an increase this morning by the same amount.

There is nothing of relevance being posted today. The rest of the week brings us the release of five pieces of economic data that may affect mortgage markets. However, none of them are considered to be highly important or potentially market-moving. We should still see some movement in rates this week, but they will likely be small moves.

Septembers Industrial Production data will start the weeks activities at 9:15 AM ET tomorrow. This release will give us an indication of manufacturing strength by tracking output at U.S. factories, mines and utilities. Analysts are expecting it to show a 0.2% increase in output from Augusts level, meaning that manufacturing activity strengthened slightly last month. A large increase in production would be negative for bonds and mortgage rates as it would indicate economic strength. A decline in output would be favorable for mortgage shoppers.

Overall, there is nothing scheduled this week that is of much concern. The most active day for mortgage rates could be any, and the same can be said for calmest day. I am expecting to see minor changes from day to day, but it will take something unexpected for rates to make a big move. We are heading into corporate earnings season, so watching stocks is a wise move also. Weaker than anticipated earnings from some key names should hurt stocks and boost bonds, leading to lower mortgage rates. On the other hand, a stock rally could pressure bonds and push mortgage rates a little higher. Despite the lack of any key economic releases, it still would be prudent to maintain contact with your mortgage professional if floating an interest rates and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Tuesdays bond market has opened in negative territory following slightly stronger than expected economic data. The major stock indexes are mixed with the Dow up 27 points and the Nasdaq down 6 points. The bond market is currently down 2/32 (2.31%), which should push this mornings mortgage rates just a tad higher than yesterdays early pricing.

Todays sole relevant economic release was Septembers Industrial Production data at 9:15 AM ET. It showed a 0.3% rise in output at U.S. factories, mines and utilities. Analysts were expecting it to show a 0.2% increase, meaning industrial production was a little stronger than thought last month. Because stronger economic activity makes bonds less appealing to investors, this report was unfavorable for mortgage rates. However, it is only a moderately important piece of data and has had a minimal impact on todays rates.

Tomorrow has two more reports scheduled that we will be watching. The first is Septembers Housing Starts at 8:30 AM ET. This Commerce Department report will probably not have much of an impact on the bond market or mortgage rates. It gives us a measurement of housing sector strength and future mortgage credit demand by tracking construction starts of new homes, but is usually considered to be of low importance to the financial and mortgage markets. It is expected to show a drop in new home starts between August and September. I believe we need to see a significant surprise in this data for it to have an impact on tomorrows mortgage rates.

The Federal Reserve will release their Beige Book report tomorrow afternoon. This report details economic conditions throughout the U.S. by Federal Reserve region. It is relied upon heavily by the Fed to determine monetary policy during their FOMC meetings. If it shows surprisingly softer economic activity since the last report, the bond market may thrive and mortgage rates could drop shortly after the 2:00 PM ET release. If it reveals signs of inflation growing or rapidly expanding economic activity in many regions, we may see mortgage rates revise higher as a result.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened in positive territory following strength in overnight trading and early stock losses. The Dow is currently down 75 points while the Nasdaq has lost 51 points. The bond market is currently up 11/32 (2.30%), which should improve this mornings mortgage rates by a little less than .125 of a discount point.

Yesterday afternoons release of the Fed Beige Book didn?t reveal any major surprises. It showed that economic activity grew at a modest and moderate pace as reported by Fed region. The report said that the labor market remains tight but inflation still remains subdued. The release covered August 29 ? October 6th and indicated the impact from the storms was temporary. The bond market had a slight reaction to the news, weakening just a bit after the 2:00 PM ET post. However, it was not enough of a move to cause a rate change with most lenders.

There were two minor pieces of economic data posted this morning. Last weeks unemployment update was the first, coming at 8:30 AM ET. It revealed that 222,000 new claims for unemployment benefits. This was a decline from the previous weeks revised 244,000 initial filings. Forecasts were calling for 236,000. The decline indicates that the employment sector was a little stronger than expected last week. Fortunately, this is a weekly report that does not draw too much attention.

The second report of the day was Septembers Leading Economic Indicators (LEI) at 10:00 AM ET. The Conference Board announced a 0.2% when analysts were expecting to see an increase of 0.1%. This data attempts to measure future economic activity, particularly during the next three to six months. Therefore, the weaker number if good news for bonds and mortgage rates.

Tomorrows sole relevant report will be Septembers Existing Home Sales data. This report will give us an indication of housing sector strength and mortgage credit demand by tracking home resales. It is expected to show a decline in sales from August to September, meaning the housing sector was flat. That would be relatively good news for the bond market since a strengthening housing sector makes broader economic growth more likely and bonds less appealing to investors. Ideally, it would show a sizable decline in sales that points toward a weakening housing sector.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Fridays bond market has opened down sharply as investors react to overnight political news. Stocks are setting new a high with the Dow up 68 points and the Nasdaq up 32 points. The bond market is currently down 18/32 (2.38%), which should push this mornings mortgage rates higher by approximately .250 of a discount point.

Septembers Existing Home Sales data was posted at 10:00 AM ET this morning. The National Association of Realtors announced that home resales rose 0.7% last month when analysts were expecting to see a decline. This indicates that the housing sector was stronger than thought, making the data bad news for bonds and mortgage rates. However, this is only a moderately important report and is not the cause of this mornings losses.

What is fueling this mornings bond selling is overnight news that the Senate narrowly approved a new budget. It is believed that now allows attention to be turned towards President Trumps request for an overhaul of our tax system. That likely will be harder to get passed, but the bond market has reacted negatively to the possibility of it happening as a couple of stock indexes have set new records this morning.

Next week brings us the release of a handful of economic reports in addition to a couple of Treasury auctions that have the potential to affect rates. The data ranges from minor to very important, but all of it comes the latter part of the week. With nothing of importance set for Monday, we can expect weekend news and stock movement to drive bond trading as the new week starts. Look for details on all of next weeks events in Sunday evening?s weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

California home prices on track to hit a record high in 2018, Realtor forecast says:

By JEFF COLLINS | [email protected] | Orange County Register
PUBLISHED: October 12, 2017 at 8:03 am | UPDATED: October 12, 2017 at 3:40 pm

California?s five-year run of rising home prices is expected to last another three to five years, with median house prices on track to beat the record highs set during the housing bubble, a Realtor economist said Thursday, Oct. 12.

The California Association of Realtors forecast home prices will increase an additional 4.2 percent in 2018, rising to $561,020. If the forecast proves accurate, that existing single-family home price will exceed the record high of $560,270 set in 2007. Prices, however, will remain well below pre-recession records when taking inflation into account.

Single-family home sales also are projected to increase in the state next year, but at a much more modest pace, the Realtor forecast said. CAR projected 426,200 houses will change hands, up 1 percent from this year?s level.

Overall, the gains in both house prices and sales are lower than in past years, perhaps signaling the California housing market?s ?rate of acceleration has been slowing,? said CAR Chief Economist Leslie Appleton-Young.

Southern California home prices are expected to rise at roughly the same pace in 2018 and to match the statewide median, Appleton Young said.

The big mystery in the housing market, however, is why the pace of sales and price growth isn?t higher given that jobs and incomes have been rising. The answer lies in twin ills that have plagued the housing market for the past four years: Too few homes for sale and too few buyers able to afford those that are on the market at today?s prices.

?It?s so odd to look at this in an environment where you?ve seen such rapid job growth and income growth and low (mortgage interest) rates,? Appleton-Young said. ?A lack of inventory and affordability ? are really keeping a lid on the California housing market. We have fewer transactions ? today than when we had 10 million fewer people living in California.?

Pulling out an old economics lesson, Appleton-Young noted that high home-price appreciation usually leads to ?a supply response? ? that is, more homeowners taking advantage of higher prices.

?We just haven?t seen that happening,? Appleton-Young said.

The reason, she said, is home sellers face possible consequences after big price gains. Not only do they lose their Prop. 13 tax advantages when they move, they also can face a capital gains tax on profits that exceed $250,000 for individuals and $500,000 for married couples.

Meanwhile, buyers are constrained as well, the economist noted. Rents have been rising so fast that few millennials can save up for a down payment to buy a home.

While half of Californians could afford the median-priced house when the market recovery started in 2012, only 26 percent will be able to afford a detached, single-family home next year, the forecast said.

A lack of homes for sale ? due in part to underbuilding ? has become the new norm, Appleton-Young said. But the scarcity is most pronounced for lower-priced, entry-level homes for first-time buyers.

?The low end is kind of disappearing,? she said. ?It pushes people inland. It pushes people out of state.?

CAR also expects mortgage interest rates to rise slightly next year, but not enough to deter homebuyers. Rates for traditional 30-year, fixed mortgages are forecast to rise to 4.3 percent in 2018. That?s still low compared with historical averages but up from 4 percent this year and 3.6 percent in 2016.

If rates were to go much higher, ?housing will be hit hard,? Appleton-Young said. She doesn?t expect that to occur, however. Instead, Appleton-Young expects home prices to continue rising for the next few years.

?I know that this cycle will not last forever,? Appleton-Young said. ?I would guess we?ve got maybe three to five more years where things can eke out the kind of increases that we?ve seen over the past couple of years.?

 

[Tamalewagon]

Back in the saddle...


Tuesdays bond market has opened in negative territory as overnight weakness is carrying into this mornings trading. A sizable gain in the Dow of 167 points while the Nasdaq is up 7 points have also contributed to this mornings bond selling. The bond market is currently down 9/32 (2.40%), which should push this mornings mortgage rates high by approximately .125 of a discount point.

There is nothing of importance set for release today that is likely to influence mortgage rates. We are seeing bonds react negatively to corporate earnings, moderately stronger economic data overseas and concerns that the European Central Bank (ECB) may start tapering their bond buying program soon (sign of economic strength). News here of potential changes to our tax system is also still lingering in the market. The result is the benchmark 10-year Treasury Note yield reaching its highest level since late March.

Tomorrow brings us the release of two pieces of economic data, one of which is much more important than the other. Durable Goods Orders report for September will be posted at 8:30 AM ET tomorrow. It gives us a measurement of manufacturing sector strength by tracking orders at U.S. factories for big-ticket items, or products that are expected to last three or more years. Analysts are currently calling for an increase of 1.3% in new orders for products such as airplanes, appliances and electronics. If we see a large increase in orders, mortgage rates will probably rise as bond prices fall. On the other hand, a significant decline should be good news for the bond market and mortgage rates, but this data can be quite volatile from month to month and is difficult to forecast. Therefore, a small variance in order either way, likely will have little effect on tomorrows bond trading or mortgage pricing.

Septembers New Home Sales will be second release, also from the Commerce Department. This report covers the small percentage of home sales that last weeks Existing Home Sales report didn't include. It is expected to show a small decline in sales of newly constructed homes, but I do not see this report having much of an impact on mortgage rates regardless what it shows. I believe the markets will be much more focused on the Durable Goods Orders data.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Wednesdays bond market has opened in negative territory again as the upward trend in yields and mortgage rates extends another day. Stocks are relatively calm, showing minor losses of 11 points in the Dow and 9 points in the Nasdaq. The bond market is currently down 11/32 (2.45%), which should push this morning?s mortgage rates higher by approximately .250 of a discount point if comparing to Tuesdays early pricing. Many lenders revised rates upward late yesterday as bond selling picked up momentum. If your lender did revise rates intraday yesterday, you should see less of an increase in this mornings pricing.

Septembers Durable Goods Orders report was posted at 8:30 AM ET this morning. The Commerce Department announced a 2.2% rise in new orders for big-ticket products such as airplanes and appliances. This was a larger rise than the 1.3% that was expected, indicating stronger manufacturing growth. A secondary reading that excludes more volatile and costly transportation-related orders, such as airplanes, was also stronger than anticipated (+0.7% vs 0.5%). Those figures make the data bad news for bonds and mortgage rates. However, bonds were already set for a weak opening before this report was released. This data is not the cause of this mornings selling, but has contributed to it.

Also posted this morning, but at 10:00 AM ET, was Septembers New Home Sales. It showed an 18.9% jump in sales of newly constructed homes last month. That was considerably stronger than predicted and pushed sales to their highest levels since October 2007. It was also the largest monthly gain since January 1992. The spike in sales indicates strength in the new home portion of the housing sector, meaning it was definitely bad news for bonds and mortgage rates.

Today also has the first of this weeks two Treasury auctions that may affect mortgage rates. Today has 5-year Notes being sold while 7-year Notes go tomorrow. If these sales are met with a strong demand from investors, bond prices may rise during afternoon trading. This could lead to improvements to mortgage rates shortly after the results of the sales are posted at 1:00 PM ET each day. But a lackluster investor interest may create selling in the broader bond market and lead to slight upward revisions to mortgage rates.

Tomorrows only relevant economic release is last weeks unemployment figures at 8:30 AM ET. They are expected to show that 235,000 new claims for unemployment benefits were filed last week, up from the previous weeks 222,000 initial claims. Since rising claims are a hint of a weakening employment sector, the higher the number the better the news it is for mortgage rates. However, because this is only a weekly report, it likely will have little impact on tomorrows mortgage rates unless it shows a significant variance.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened flat with little to drive trading this morning and a mixed open in stocks. The Dow is currently up 106 points while the Nasdaq has slipped 1 point. The bond market is currently unchanged from yesterdays close (2.43%), but strength late yesterday should improve this mornings mortgage rates by approximately .125 of a discount point if comparing to yesterdays early pricing. Many lenders revised rates lower late Tuesday as stocks weakened. If your lender did revise rates lower intraday yesterday, you may not see a change in this mornings pricing.

Yesterdays 5-year Treasury Note auction went relatively well but not overly strong. Most of the indicators we use to gauge investor demand showed an average level of interest in the securities or slightly better. The bond market had little reaction to the news, meaning we do not have much to be concerned or optimistic about in todays 7-year Note sale. Results will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading. Strong demand during these auctions tend to help boost bond prices, pushing yields and mortgage rates slightly lower.

Last weeks unemployment update was todays only relevant release, coming at 8:30 AM ET. It showed that 233,000 new claims for unemployment benefits were filed last week, up from the previous weeks revised 223,000. The increase is good news for bonds and mortgage rates because rising claims is considered a sign of a softening employment sector. However, forecasts were calling for 235,000 and this is only a weekly update compared to the more important monthly reports we rely on. Therefore, the news has been a non-factor on this mornings mortgage pricing.

Tomorrow has two economic reports scheduled, one of which is extremely important to the markets. That would be the preliminary reading of the 3rd Quarter Gross Domestic Product (GDP) at 8:30 AM ET. The GDP is considered to be the benchmark measurement of economic growth because it is the total of all goods and services produced in the U.S. and therefore is likely to have a major impact on the financial markets and mortgage pricing. There are three versions of this report, each a month apart. Tomorrows release is the first and usually has the biggest influence on the markets. Current forecasts call for an increase of approximately 2.4% in the GDP, which would mean that the economy grew at a slower pace than the 2nd quarters 3.1% rate. If this report shows a much smaller increase, I am expecting to see the bond market rally and mortgage rates fall. However, a larger than expected rise could lead to a rally in stocks, bond selling and a sizable increase in mortgage pricing tomorrow morning.

The weeks last report comes just before 10:00 AM ET tomorrow when the University of Michigan updates their Index of Consumer Sentiment for this month. This report is moderately important because it helps us measure consumer confidence, which is believed to indicate consumers willingness to spend. Current forecasts show this index moving little from its preliminary reading of 101.1. Good news for mortgage rates would be a sizable decline in the index, meaning consumers are likely to not spend as much as last month.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Fridays bond market has opened in positive territory despite stronger than expected results in a key piece of economic data. Stocks are mixed with the Dow up only 5 points and the Nasdaq up 101 points. The bond market is currently up 8/32 (2.43%), but selling late yesterday will prevent an improvement in this mornings mortgage rates. There were widespread upward revisions to mortgage rates of approximately .125 of a discount point late yesterday as bond selling intensified. This mornings gains should offset that increase, causing todays rates to be very close to Thursdays early pricing.

Yesterdays 7-year Note sale was pretty weak with several benchmarks pointing towards a lackluster interest in the securities. While that is bad news for the broader bond market, it really was not the cause of yesterdays late selling. The downward move in bonds (upward move in yields and mortgage rates) started well after the results of the auction were posted.

The preliminary reading of the 3rd Quarter Gross Domestic Product (GDP) was posted at 8:30 AM ET this morning. It showed that the economy grew at a 3.0% annual pace, noticeably better than the 2.4% that was expected. In addition, a secondary reading that measure inflationary pressures also came in higher than forecasted. Since bonds tend to thrive in weaker economic conditions, this data is unfavorable to the bond market and mortgage rates. Fortunately, traders do not seem to be too concerned about it.

Also posted this morning but at 10:00 AM ET was the revised University of Michigan Index of Consumer Sentiment for October. It came in at 100.7, falling a little short of the 101.0 that was expected. The lower reading indicates surveyed consumers were less optimistic about their personal financial situations than previously thought. With weaker sentiment, weaker consumer spending usually follows. That makes the data good news for bonds and mortgage rates, but this was a minor variance in a moderately important report. Therefore, we are not seeing it have much of an influence on mortgage rates.

Next week is packed with mortgage-relevant economic data, some of which is considered extremely important to the markets. We also have another FOMC meeting to contend with mid-week. One of those reports does come Monday (Personal Income and Outlays), meaning we may see movement in rates right out of the gate.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Mondays bond market has opened in positive territory, extending Fridays afternoon strength. The major stock indexes are starting the week mixed with the Dow down 45 points and the Nasdaq up 9 points. The bond market is currently up 7/32 (2.39%), which with Fridays late strength should improve this mornings mortgage rates by approximately .250 of a discount point. If your lender was one of the many that improved rates intraday Friday afternoon, you should see less of an improvement in this mornings pricing.

The Commerce Department gave us Septembers Personal Income and Outlays report at 8:30 AM ET this morning, announcing a 0.4% rise in income and a 1.0% jump in spending. Both readings exceeded forecasts of up 0.3% and 0.8% respectively, indicating consumers had slightly more to spend last month and actually did spend more than thought. However, the increase in spending is being attributed to storm-related purchases, so we are seeing little response to the data in todays early trading.

The 3rd Quarter Employment Cost Index (ECI) will be released at 8:30 AM ET tomorrow. This data tracks employer costs for salaries and benefits, giving us an indication of wage inflation pressures. Rapidly rising costs raises wage inflation concerns and may hurt bond prices. It is expected to show an increase in costs of 0.6%. A smaller than expected increase would be good news for mortgage rates, but this is not one of the more important reports of the week.

Octobers Consumer Confidence Index (CCI) will also be posted tomorrow, but at 10:00 AM ET. This Conference Board index gives us a measurement of consumer willingness to spend. It is expected to show a rise in confidence from last months 119.8 reading. That would mean that surveyed consumers better about their own financial and employment situations than they did last month, indicating they are more likely to make large purchases in the near future. That would be unfavorable news for the bond market because consumer spending makes up over two-thirds of our economy. Current forecasts are showing a reading of 121.5. The lower the reading, the better the news it is for mortgage rates.

Overall, the single most important day is Friday due to the Employment report but Wednesday is expected to be pretty active also with the ISM release and FOMC meetings both taking place. We have plenty of relevant data set for release this week, making it quite likely that we will see another active week for mortgage rates. Accordingly, please maintain contact with your mortgage professional if still floating a rate and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Tuesdays bond market has opened in down slightly following stronger than expected economic news. The stock markets are mixed but calm with the Dow down 7 points and the Nasdaq up 11 points. The bond market is currently down 2/32 (2.37%), but we still should see a slight improvement in this mornings mortgage pricing due to strength late yesterday.

This first of todays economic releases was the 3rd Quarter Employment Cost Index (ECI) at 8:30 AM ET. It showed a 0.7% increase, exceeding forecasts of 0.6% rise. This means employer costs for wages and benefits rose slightly more than expected during the July ? September months. While this is considered a sign of wage inflation, making the data bad news for mortgage rates, it came from a moderately important release and had only a minor variance from forecasts. Therefore, it has had little impact on this mornings mortgage pricing.

Also released today was Octobers Consumer Confidence Index (CCI) 10:00 AM ET. The Conference Board announced a reading of 125.9 that was well above the 121.5 that was expected. That indicates surveyed consumers were much more optimistic about their own financial situations than many had thought. Because rising confidence usually translates into stronger levels of consumer spending, this is also unfavorable news for the bond market and mortgage rates.

Tomorrow starts with two morning economic releases, one of which is very important. The first is the ADP Employment report before the markets open. It has the potential to cause some movement in the markets if it shows much stronger or weaker numbers than expected. This report tracks changes in private-sector jobs, mostly of ADPs clients that use them for payroll processing. While it does draw attention, it is my opinion that it is overrated and is not a true reflection of the broader employment picture. It also is not accurate in predicting results of the monthly government report that follows a couple days later. Still, because we have seen reaction to the report, we should be watching it. Analysts are expecting it to show that 217,000 new payrolls were added. The lower the number of jobs, the better the news it is for mortgage rates.

The second and more important report of the day will be the Institute for Supply Managements (ISM) manufacturing index for October at 10:00 AM ET. This index measures manufacturer sentiment, which is important because it gives us an indication of manufacturing sector strength. It is considered to be one of the more important reports we see each month, partly because it is the first every month that tracks the preceding month's activity. Tomorrows release is expected to show a reading of 59.3, indicating that manufacturer sentiment slipped from Septembers level 60.8. This means fewer surveyed manufacturing executives felt business improved during the month than in September, hinting at weaker manufacturing sector activity. A smaller than expected reading would be good news for bonds and likely lead to lower mortgage rates.

Also tomorrow is adjournment of this weeks FOMC meeting that began today. It is widely expected that the Fed will not make a change to key short-term interest rates. Chairperson Janet Yellen and friends have indicated they expect to make a rate hike before the end of the year, but it would come as a major surprise if it came at this meeting. That means that market participants are expecting it to come during Decembers meeting. The meeting will adjourn at 2:00 PM ET and does not include economic projections or a press conference. These meetings normally have a strong likelihood of causing volatility in the markets. However, I believe this one will have less of an impact than usual unless there is a surprise in talk of the Feds balance sheet reduction plan.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Wednesdays bond market has opened up slightly following mixed economic data. The stock markets are in rally mode with the Dow up 126 points and the Nasdaq up 15 points. The bond market is currently up 3/32 (2.36%), but weakness late yesterday is going to prevent much of a change in this mornings mortgage pricing.

The first of todays three mortgage-relevant events was the ADP Employment report at 8:15 AM ET. It showed that 235,000 new private-sector jobs were added last month, beating forecasts of 217,000. That is bad news for bonds and mortgage rates because it points toward good growth in the employment sector. However, Friday will bring us the monthly government report that includes both private and public-sector data.

The second economic release was the highly important Institute for Supply Managements (ISM) manufacturing index for October that was posted 10:00 AM ET. It came in at 58.7, down from Septembers 60.8 and a little lower than the 59.3 that was expected. The decline indicates fewer surveyed manufacturing executives felt business improved last month than in September. That is a sign of manufacturing weakness, making the data favorable for bonds and mortgage rates.

The third event will come this afternoon when the second to last FOMC meeting of the year will adjourn. It is widely expected to yield no change to key short-term interest rates. Chairperson Janet Yellen and friends have indicated they expect to make a rate hike before the end of the year, but it would come as a major surprise if it came at this meeting. That means that market participants are expecting it to come during Decembers meeting. The meeting will adjourn at 2:00 PM ET, so any reaction will come during mid-afternoon trading. and does not include economic projections or a press conference. These meetings normally have a strong likelihood of causing volatility in the markets. However, I believe this one will have less of an impact than usual unless there is a surprise in talk of the Fed?s balance sheet reduction plan.

There are a couple of minor economic reports set for release tomorrow morning. They will be addressed in this afternoons update that will be posted shortly after the markets have an opportunity to react to todays FOMC results.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

WEDNESDAY AFTERNOON UPDATE:
This weeks FOMC meeting has adjourned with an announcement of no change to key short-term interest rates. This was widely expected by market participants, but practically cements a rate hike at the Feds mid-December meeting. They also confirmed their balance sheet reduction program did start this past month and is proceeding as planned.

The post-meeting statement failed to yield any surprises that were noteworthy. It referenced employment sector growth specifically, despite storm-related influences, and reiterated that inflation remains noticeably weaker than their preferred annual rate of 2.0%. As a result, the news had little impact on the bond or mortgage markets with bonds nearly unchanged from this morning?s levels. Stocks have retreated a little, giving back some of this morning?s gains. The Dow is currently up 70 points (from 126) while the Nasdaq has fallen into negative ground with an 11-point loss (up 15 points this morning). In other words, as predicted, the meeting was somewhat of a dud.

This morning had two pieces of economic data that gave us mixed results. The first was the ADP Employment report at 8:15 AM ET. It showed that 235,000 new private-sector jobs were added last month, beating forecasts of 217,000. That is bad news for bonds and mortgage rates because it points toward good growth in the employment sector. Although, Friday will bring us the monthly government report that includes both private and public-sector data.

The second release of the morning was the highly important Institute for Supply Managements (ISM) manufacturing index for October that was posted 10:00 AM ET. It came in at 58.7, down from September?s 60.8 and a little lower than the 59.3 that was expected. The decline indicates fewer surveyed manufacturing executives felt business improved last month than in September. That is a sign of manufacturing weakness, making the data favorable for bonds and mortgage rates.

Tomorrow has a couple of minor economic reports for the markets to digest. 3rd Quarter Productivity reading will be released at 8:30 AM ET tomorrow. It is expected to show a 2.8% improvement in worker productivity during the third quarter. A larger increase would be good news for the bond market because higher levels of employee productivity allow the economy to expand without inflationary pressures being a concern. This is a relatively low importance report, so it will take a significant variance from forecasts for it to directly affect mortgage rates.

Also early tomorrow will be last weeks unemployment update. It is expected to show that 235,000 new claims for unemployment benefits were filed last week, up from the previous week?s 233,000 initial claims. Since rising claims hints at employment sector weakness, the higher the number the better the news it is for mortgage rates. But since this is only a weekly report, it likely will have little impact on tomorrow? mortgage rates unless it shows a significant variance.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays bond market has opened in positive territory as the positive momentum for bonds continues. Stocks are showing moderate losses with the Dow down 64 points and the Nasdaq down 24 points. The bond market is currently up 9/32 (2.34%), which should improve this mornings mortgage rates by approximately .250 of a discount point if comparing to Wednesdays morning pricing.

There were two minor economic reports released at 8:30 AM ET this morning. The 3rd Quarter Productivity reading showed that productivity grew at an annual rate of 3.0%, beating the 2.8% that was expected. However, a jump of 0.5% in the labor costs reading neutralizes the good news in the productivity gains. The net impact on mortgage rates is neutral.

The second release was last weeks unemployment figures that revealed 229,000 new claims were filed. This was a decline from the previous weeks revised 234,000 initial filings, hinting that the employment sector strengthened a little last week. Since analysts were expecting to see a small increase in claims, we should consider this data bad news for bonds and mortgage rates. Fortunately, it is only a weekly report, minimizing its influence on this mornings pricing.

Tomorrow brings us the release of Octobers Employment report at 8:30 AM ET. This major report is comprised of many statistics and readings, but the most important ones are the unemployment rate, the number of new jobs added or lost during the month and average hourly earnings. Current forecasts call for a 0.1% increase in the unemployment rate, rising from 4.2% to 4.3%. It is also expected to show an increase in payrolls of 320,000, rebounding from Septembers surprising loss of 33,000 jobs. The third headline number is average earnings that is expected to reveal a 0.2% rise. Weaker than expected readings should renew concerns about the labor market and rally bonds enough to improve mortgage rates noticeably, especially if the stock markets react poorly to the news.

Septembers Factory Orders data will also be released tomorrow, but at 10:00 AM Et. This report is similar to last weeks Durable Goods Orders report except it includes orders for both durable and non-durable goods. It is expected to show a 1.2% increase in new orders from Augusts level. A large decline would be good news for the bond market and mortgage rates while an unexpected rise would be bad news. However, it is worth noting though, that this report is not considered to be highly important to mortgage rates and it follows a major release. Therefore, it probably will not play a role in tomorrows mortgage pricing.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

http://mymortgagestatus.info/miam/?...1905724F3528A3765A88CCE43D4511EB8350C16AB6BC3

 

[Tamalewagon]

Fridays bond market has opened fairly flat following a mixed bag of employment figures. The major stock indexes are also calm with the Dow down 13 points and the Nasdaq up 7 points. The bond market is currently unchanged from yesterdays close (2.34%), but we still may see a slight improvement in this morning?s rates due to strength late yesterday.

Todays major economic release was Octobers Employment report at 8:30 AM ET. It showed that the U.S. unemployment rate slipped from 4.2% to 4.1% last month and that 261,000 new jobs were added to the economy. The unemployment rate was expected to rise slightly and Octobers 4.1% was the lowest we have seen since December 2000. That means we should consider that portion of the report bad news. The good news came in the payroll number that was predicted to show 320,000. Septembers and Augusts payroll numbers were revised higher, adding 90,000 jobs over those months though. That news has put a damper on the reaction to Octobers softer than expected jobs figures.

Average hourly earnings, which relates to wage inflation, came in unchanged from Septembers level. That is good news because analysts were expecting to see a 0.2% increase. Any weaker than forecasted inflation data is usually favorable news for the bond and mortgage markets.

The Commerce Department gave us Septembers Factory Orders data at 10:00 AM ET. They announced a 1.4% increase in new orders for durable and non-durable goods. This was a bit stronger than the 1.2% that analysts were calling for, but not enough of a variance to cause much concern in the bond market. In other words, while the data is unfavorable for bonds, it has not had much of an impact on this mornings mortgage pricing.

Next week brings us little to drive bond trading and mortgage rates. The biggest events will be a couple of Treasury auctions mid-week. There is nothing taking place Monday that we need to be concerned with, so if there is a noticeable change to mortgage pricing as the week starts, weekend news will likely be the cause. Look for details on next weeks calendar in Sunday evenings weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Mondays bond market has opened in positive territory as Fridays late strength extends into the new week. The stock markets are showing minor gains with the Dow up 13 points and the Nasdaq up 14 points. The bond market is currently up 3/32 (2.32%), which with Friday?s afternoon gains should improve this mornings mortgage rates by slightly more than .125 of a discount point. If your lender improved pricing Friday afternoon, you should see less of an improvement this morning.

There is nothing scheduled for release today that is relevant to mortgage rates. If there is an intraday revision to mortgage pricing, it probably be a result of a move in stocks. Generally speaking, stock strength usually translates into bond weakness and higher mortgage rates. If stocks remain near current levels, bonds and mortgage rates will likely follow suit.

The rest of the week brings us little that is expected to affect mortgage rates. There is only one monthly report set to be posted in addition to a couple of Treasury auctions that can be influential. It is likely to be a much calmer week for the mortgage market compared to recent weeks.

The first events of the week will be the two important Treasury auctions Wednesday and Thursday. 10-year Treasury Notes will be sold Wednesday while 30-year Bonds go Thursday, giving us an indication of demand for long-term securities. If the sales are met with a strong demand from investors, we should see the bond market move higher during afternoon trading Wednesday and/or Thursday. But a lackluster interest from buyers, particularly international investors, would indicate a waning appetite for longer-term U.S. securities and lead to broader bond selling. The selling in bonds would probably result in upward revisions to mortgage rates. Wednesdays 10-year Note auction usually has the bigger impact on rates than 30-year Bonds.

Overall, I am not expecting to see an overly active week for mortgage rates, although we should see movement more than one day. Wednesday is the best candidate for most important day due to the 10-year Treasury Note auction. We could see the markets get active at any time if stocks make a move upward or downward, so it is recommended that you still maintain contact with your mortgage professional if still floating an interest rate and closing soon.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Wednesday Rate Lock Advisory -

Wednesday’s bond market has opened up slightly with stocks in negative ground. The Dow is currently down 33 points while the Nasdaq has lost 4 points. The bond market is currently up 2/32 (2.31%), which should keep this morning’s mortgage rates at yesterday’s levels.

Today’s only relevant news comes this afternoon when the results of today’s 10-year Treasury Note auction. Results of the sale will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading. If it was met with a strong demand from investors, we should see the bond market move higher this afternoon, possibly leading to an improvement in mortgage rates. On the other hand, a lackluster interest from buyers, particularly international investors, would indicate a waning appetite for longer-term U.S. securities and lead to broader bond selling. The selling in bonds usually result in upward revisions to mortgage pricing. This scenario will repeat again tomorrow when 30-year Bonds are sold.

Besides the auction, tomorrow also has last week's unemployment figures at 8:30 AM ET. They are forecasted to show that 231,000 new claims for unemployment benefits were filed last week, up slightly from the previous week’s 229,000 initial claims. This report usually doesn't cause much movement in the markets or mortgage rates unless it shows a significant jump or drop in initial claims for benefits. However, with so little on tap this week, we should see more of a reaction to a surprise than usual. The higher the number of claims, the better the news it is for bonds and mortgage rates since rising claims are a sign of employment sector weakness.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Thursdays Daily Rate Lock Advisory -

Thursday’s bond market has opened down slightly even though today’s only economic data gave us favorable results and stocks are showing early weakness. The major stock indexes are posting noticeable losses, pushing the Dow lower by 98 points and the Nasdaq down 37 points. The bond market is currently down 2/32 (2.33%), but due to weakness late yesterday we should see this morning’s mortgage rates be approximately .125 of a discount point higher than Wednesday’s morning pricing.

Yesterday’s 10-year Treasury Note auction went pretty well, but bonds still managed to give up ground during afternoon trading. Despite that slide, we still remain optimistic about today’s 30-year Bond auction. Results will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading. If it was met with a strong demand from investors, we could see the bond market move higher this afternoon, possibly leading to an improvement in mortgage rates. On the other hand, a lackluster interest from buyers, particularly international investors, would indicate a waning appetite for longer-term U.S. securities and lead to broader bond selling. The selling in bonds usually results in an upward revision to mortgage pricing.

Today’s only relevant economic data was last week's unemployment figures at 8:30 AM ET. They showed that 239,000 new claims for unemployment benefits were filed last week. They were expected to show that 231,000 new filings were made, meaning the employment sector was a little softer than thought last week. That is good news for bonds and mortgage rates. Unfortunately though, this is only a weekly snapshot. That means it does not carry enough significance to offset last night’s overnight weakness.

Tomorrow has this week’s sole monthly economic release at 10:00 AM ET. That is when November's preliminary reading of the University of Michigan's Index of Consumer Sentiment will be posted. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It is expected to show a reading of 100.4, down a little from October's final reading of 100.7. That would be considered positive news for bonds because rising sentiment means consumers are more optimistic about their own financial situations and are more likely to make large purchases in the near future. And with consumer spending so important, any related data is watched closely. The lower the reading, the better the news it is for mortgage shoppers.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Friday’s bond market has opened in negative territory despite much weaker than expected economic news. Stocks are also showing losses with the Dow down 47 points and the Nasdaq down 17 points. The bond market is currently down 11/32 (2.37%), which should push this morning’s mortgage rates higher by approximately .125 of a discount point.

Yesterday’s 30-year Treasury Bond auction followed suit of Wednesday’s 10-year sale, showing a decent level of investor interest. The bond market initially responded favorably once results were posted, but as the afternoon went on selling kicked in. That caused bond yields to rise and a few lenders to raise mortgage rates slightly before the end of the day. The selling wasn’t a result of the auction. With the recent rally in bonds we should expect some profit-taking to come into the market.

Today’s only economic data gave us favorable results. November's preliminary reading of the University of Michigan's Index of Consumer Sentiment came in at 97.8, falling short of the 100.4 that was forecasted. It was also a decline from October’s final reading, indicating that surveyed consumers did not feel as good about their own financial situations as they did last month. Because waning confidence usually translates into softer levels of consumer spending that fuels economic growth, we can consider the data positive for bonds and mortgage rates. However, this report is not important enough to offset the overnight weakness that took place.

Next week brings us a handful of relevant economic releases, some of which are very important. Among them are two important inflation readings and a measurement of consumer spending. The most influential data comes mid-week and there is nothing scheduled for Monday that we need to be concerned about. Look for details on all of next week’s events in Sunday evening’s weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Monday’s bond market has opened in positive territory, erasing Friday’s afternoon selling. The major stock indexes are starting the week flat with the Dow up 2 points and the Nasdaq down 6 points. The bond market is currently up 4/32 (2.38%), but due to weakness Friday afternoon we should see little change in mortgage rates if comparing to Friday’s morning pricing.

There is nothing of relevance to mortgage rates taking place today. The rest of the week brings us the release of five pieces of economic data, several of which are considered very important to the markets. That raises the possibility of seeing noticeable movement in the bond market and mortgage rates over the next several days. If we see an intraday change to mortgage pricing today, it will likely be a reaction to a move in stocks.

The first of this week’s releases is October's Producer Price Index (PPI) at 8:30 AM ET tomorrow, which is one of the two key inflation readings on tap this week. There are two portions of the index that are used- the overall reading and the core data reading. The core data is the more important of the two because it excludes more volatile food and energy prices. Signs of rapidly rising inflation make long-term securities such as mortgage-related bonds less attractive to investors and leads to higher mortgage rates. The overall reading is expected to show a 0.1% rise from September's level while the core data is expected to rise 0.2%. Weaker than expected readings would be good news for bonds and mortgage rates, while a larger than forecasted increase in the core reading could lead to higher mortgage rates tomorrow morning.

Overall, it is likely going to be another active week for mortgage rates. The most movement is probably going to come the middle days, but we can see volatility any day. Therefore, please proceed cautiously if you are closing in the near future and still floating an interest rate.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Greetings! Here's your Daily Commentary report compliments of
Wenhe Mortgage and Realty!
Contact us at (619) 255-3182 for today's competitive interest rates!

Tuesday’s bond market has opened in positive territory despite stronger than expected economic news. The strength in bonds is likely being fueled by early stock selling that has the Dow down 146 points and the Nasdaq down 42 points. The bond market is currently up 9/32 (2.37%), which should improve this morning’s mortgage rates by just less than .125 of a discount point from Monday’s early pricing.

October's Producer Price Index (PPI) was posted at 8:30 AM ET this morning, revealing a 0.4% increase in both the overall and core readings. Both readings exceeded expectations of up 0.1% and 0.2% respectively. This means that inflationary pressures at the manufacturing level of the economy were stronger than thought. That makes the data bad news for mortgage rates because rising inflation erodes the value of a bond’s future fixed interest payments, causing them to be less appealing to investors. Higher levels of inflation also allow the Fed to raise key short-term interest rates more often.

Tomorrow has two monthly reports at 8:30 AM ET that may have an impact on mortgage rates. Both of them are considered to be important for the bond and mortgage markets. The first will come from the Commerce Department, who will give us October's Retail Sales. This data measures consumer level or retail spending. It is considered extremely important to the markets because consumer spending makes up over two-thirds of the U.S. economy. It is expected to show a 0.1% increase in retail-level spending, meaning consumers spent a bit more last month than they did in September. A larger increase in spending would be considered negative news for bonds because rising spending fuels economic growth and raises inflation concerns in the bond market. If tomorrow's report reveals a decline that indicates consumers spent less than thought, bonds should react favorably, pushing mortgage rates lower. If it shows a larger rise, mortgage rates will likely move higher.

Next up is October's Consumer Price Index (CPI) from the Labor Department, also at 8:30 AM ET. The CPI is the sister report to today's PPI, except it measures inflationary pressures at the consumer level of the economy and is one of the most important reports the bond market sees each month. If it reveals stronger than expected readings like this morning’s release did, the bond market will probably react negatively and cause mortgage rates to move higher. Analysts are expecting to see a 0.1% increase in the overall reading and a 0.2% increase in the core data.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

Scott Wenhe
Phone: 619-255-3182

 

[Tamalewagon]

Greetings! Here's your Daily Commentary report compliments of
Wenhe Mortgage and Realty!
Contact us at (619) 255-3182 for today's competitive interest rates!

RATE'S ARE LOWER TODAY! It's a good day to lock.

Wednesday’s bond market has opened in positive territory with stocks showing sizable losses. The Dow is currently down 110 points while the Nasdaq has lost 28 points. The bond market is currently up 8/32 (2.34%), which should improve this morning’s mortgage rates by approximately .125 of a discount point.

The Commerce Department gave us the first of this morning’s two important economic reports with the release of October's Retail Sales data at 8:30 AM ET. It showed a 0.2% rise in consumer spending, slightly exceeding forecasts of 0.1%. However, a secondary reading that excludes more volatile auto transactions came in at up 0.1% when it was expected to rise 0.2%. Those variances offset each other with the headline increase being slightly negative for mortgage rates but the secondary reading is good news. The net result is a neutral impact on bond trading and mortgage pricing.

Also at 8:30 AM was the release of October's Consumer Price Index (CPI) from the Labor Department. They announced a 0.1% increase in the overall reading and a 0.2% rise in the more important core data. Both readings matched expectations and point towards subdued inflationary pressures at the consumer level of the economy. This is good news for bonds and mortgage securities because rapidly rising inflation makes long-term securities less appealing to investors. Although, since they didn’t show surprises, their impact on this morning’s mortgage rates has been minimal.

Tomorrow has two pieces of economic data that may affect mortgage rates, but neither are considered to be highly important. The first will come at 8:30 AM ET when last week’s unemployment figures are released. They are expected to show that 234,000 new claims for unemployment benefits were filed last week, down from the previous week’s 239,000 initial claims. Since rising claims hints at employment sector weakness, the higher the number the better the news it is for mortgage rates. However, because this is only a weekly report, it likely will have little influence on tomorrow’s mortgage rates unless it shows a significant variance.

The second release will be October's Industrial Production report at 9:15 AM ET that measures manufacturing sector strength by tracking output at U.S. factories, mines and utilities. It is expected to show a 0.5% increase from September's level. A decline would be considered favorable news for bonds and mortgage rates because it would indicate manufacturing sector weakness and broader economic growth would be more difficult if manufacturing activity is slipping.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

Scott Wenhe
Phone: 619-255-3182

 

[Tamalewagon]

http://www.mortgagenewsdaily.com/consumer_rates/817287.aspx

 

[Tamalewagon]

Thursday’s bond market has opened in negative territory following mixed economic data. Stock strength is contributing to this morning’s bond weakness with the Dow up 161 points and the Nasdaq up 69 points. The bond market is currently down 9/32 (2.35%), but strength late yesterday should keep this morning’s mortgage rates close to Wednesday’s morning pricing.

Last week’s unemployment figures were posted at 8:30 AM ET this morning, showing 249,000 new claims for unemployment benefits were filed last week. This higher than the previous week’s 239,000 new claims and exceeded forecasts of 234,000. That indicates the employment sector was a little weaker than thought last week, making the data favorable for bonds and mortgage rates. However, this is only a weekly snapshot, so its impact on today’s trading has been minimal.

Also posted this morning was October's Industrial Production report at 9:15 AM ET. It revealed a 0.9% rise in output at U.S. factories, mines and utilities when it was expected to increase 0.5%. That is a sign that manufacturing activity is rising, making the data negative for mortgage rates. Fortunately, this is also considered to only be a minor report, limiting its influence on today’s mortgage rates.

The week’s calendar closes with October's Housing Starts early tomorrow morning. This report gives us a measurement of housing sector strength, but usually does not have a noticeable impact on mortgage rates. I don't expect this month's version to be any different unless it varies greatly from analysts' forecasts. It is expected to show an increase in starts of new homes, meaning the new home portion of the housing sector strengthened last month.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

http://mymortgagestatus.info/miam/?...B1F737A03F552379F7488E05E63BB03374CA691B12E1A

 

[Tamalewagon]

Friday’s bond market has opened in positive territory despite much stronger than anticipated housing news. The major stock indexes are showing relatively minor losses with the Dow down 46 points and the Nasdaq down 1 point. The bond market is currently up 8/32 (2.34%), but weakness late yesterday is going to prevent much of a change in this morning’s mortgage rates. If your lender revised pricing higher Thursday afternoon, you should see a slight improvement in this morning’s rates.

The Commerce Department announced early this morning that October's Housing Starts jumped 13.7%, exceeding forecasts by a wide margin. A secondary reading that tracks new permits issued, giving us an indication of future groundbreakings, also came in higher than expected. The data points towards a strengthening new home portion of the housing sector, making the data bad news for bonds and mortgage rates. Fortunately, this is not considered to be a highly important report, minimizing its impact on today’s trading.

Next week will be shortened due to the Thanksgiving holiday but still has a couple of economic reports and other items that we need to watch. Most of the data being released is considered moderately important but there is also one report that does draw plenty of attention in addition to the minutes from the most recent FOMC meeting.

There is a minor release set for Monday morning (Leading Economic Indicators) to start the week, but it shouldn’t be of much concern. Look for details on all of next week’s activities and holiday calendar in Sunday evening’s weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Monday’s bond market has opened down slightly with stocks showing early strength. The major stock indexes are beginning the week with moderate gains, pushing the Dow up 59 points and the Nasdaq up 10 points. The bond market is currently down 3/32 (2.35%), which should keep this morning’s mortgage pricing very close to Friday’s early levels.

The holiday-shortened calendar kicked-off with the release of October’s Leading Economic Indicators (LEI) at 10:00 AM ET today. The Conference Board announced an increase of 1.2% in the indicators, meaning they are predicting economic growth over the next several months. That exceeded forecasts of a 0.8% rise, making the data bad news for mortgage rates. Fortunately, this report is not considered to be one of the more important releases we get each month, minimizing its impact on today’s trading.

There are three more economic releases scheduled for the markets to digest this week in addition to the minutes from the most recent FOMC meeting. October's Existing Home Sales data is next, coming at 10:00 AM tomorrow morning. The National Association of Realtors will give us a measurement of housing sector strength and mortgage credit demand by tracking home resales in the U.S. This report is expected to show a small increase, meaning the housing sector strengthened slightly last month. That would be relatively bad news for the bond market and mortgage pricing, but unless it shows a significant surprise, it shouldn’t have a major impact on mortgage rates.

The financial markets will be closed Thursday in observance of the Thanksgiving Day holiday. There will not be an early close Wednesday ahead of the holiday, but the stock and bond markets will close early Friday and will reopen next Monday morning. I suspect that Friday will be a very light day in bond trading as many market participants will be home. The same can be said to some degree Wednesday afternoon also. Banks must be open Friday, but we will likely see little change to mortgage rates that day.

Overall, I am expecting Wednesday to be the busiest day for the bond market and mortgage rates with three of the week's releases scheduled, including the FOMC minutes. The calmest day of the week will most likely be Friday. Despite the holiday, this still may end up being an active week for mortgage rates. Accordingly, please proceed extremely cautiously if still floating an interest rate and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

 

[Tamalewagon]

Tuesday’s bond market has opened in positive territory despite stronger than expected results in today’s sole economic release and a strong open for stocks. The Dow is currently up 151 points while the Nasdaq has gained 63 points. The bond market is currently up 5/32 (2.35%), which should keep this morning’s mortgage pricing unchanged from Monday’s morning rates. If your lender revised rates slightly higher yesterday afternoon, you should see an improvement in this morning’s rates of the same size.

October's Existing Home Sales data was posted at 10:00 AM this morning. The National Association of Realtors announced that home resales rose 2.0% last month, exceeding expectations. That means the housing sector was stronger than thought. Because a strengthening housing sector makes broader economic growth more likely, we should consider this data unfavorable for bonds and mortgage rates.

Tomorrow has two economic reports scheduled for release. The first is October's Durable Goods Orders at 8:30 AM ET. This data helps us measure manufacturing strength by tracking orders for big-ticket items or products that are expected to last three or more years, such as airplanes, appliances and electronics. This data is known to be quite volatile from month-to-month, so sizable swings from the previous month are fairly normal. It is expected to show a 0.4% rise in new orders. A decline would be considered good news for the bond market and mortgage rates as it would indicate the manufacturing sector was not as strong as thought. We need to see a sizable variance from forecasts though for the markets to have a noticeable reaction due to the usual volatility in the data. It is worth mentioning though that this is the most important report of the week.

The second report of the day will be the revised University of Michigan Index of Consumer Sentiment for November. Current forecasts are calling for a slight increase (97.9 from 97.8), meaning surveyed consumers felt nearly the same about their own financial and employment situations as they did in October. Bond traders would prefer to see a decline because waning confidence usually means consumers are less likely to make a large purchase in the near future, restricting economic growth.

Also worth noting is the release of the minutes from the last FOMC meeting tomorrow afternoon that can have an impact on the financial and mortgage markets. Traders will be looking for any indication of the Fed's next move regarding monetary policy, particularly something that would hint that a rate increase will not come next month as it is widely expected to. They will be released at 2:00 PM ET, so any reaction will come during afternoon trading. This release is one of those that may cause some volatility in the markets after they are posted, or could be a non-factor. If they show anything surprising regarding when the Fed will raise key short-term interest rates again or their balance sheet reduction plan, we will see some movement in rates tomorrow afternoon.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

Scott Wenhe
Phone: 619-255-3182
[email protected]

 

[Tamalewagon]

Monday’s bond market has opened flat despite unfavorable economic news and early gains in stocks. The major stock indexes are posting minor gains with the Dow up 52 points and the Nasdaq up 1 point. The bond market is unchanged from Friday’s early close (2.34%), which should keep this morning’s mortgage rates at Friday’s levels.

The week started with a relatively minor economic release late this morning. The Commerce Department gave us October's New Home Sales data at 10:00 AM ET, announcing a 6.2% rise in sales of newly constructed homes. This was much stronger than expected and pushed sales to their highest level since October 2007. The unexpected rise indicates the new home portion of the housing sector was stronger than many had thought. That makes the data bad news for bonds and mortgage rates.

In addition to this week's five more economic reports, there are two relatively important Treasury auctions that may also influence bond trading enough to affect mortgage rates. There will be an auction of 5-year Treasury Notes today and 7-year Notes tomorrow. Neither of these sales will directly impact mortgage pricing, but they can influence general bond market sentiment. If the sales go poorly, we could see broader selling in the bond market that leads to upward revisions in mortgage rates. However, strong investor demand usually makes bonds more attractive to investors and brings more funds into the bond market. The buying of bonds that follows often translates into lower mortgage rates. Results of the sales will be posted at 1:00 PM ET both days. Any reaction to the sales will come shortly after results are posted.

November's Consumer Confidence Index (CCI) will be released at 10:00 AM ET tomorrow morning by the Conference Board. This index helps us track consumer willingness to spend. If a consumer's confidence in their own financial and employment situation is strong, analysts believe that they are more apt to make larger purchases, fueling economic growth. This is important because consumer spending makes up over two-thirds of the U.S. economy and strength in it makes long-term securities such as mortgage-related bonds less attractive to investors. Analysts are expecting to see decline in confidence from last month's level, meaning surveyed consumers were less optimistic about their own financial situations this month than they were last month. A weaker reading than the 124.0 that is expected would be good news for mortgage rates, while a stronger reading could push mortgage rates higher Tuesday.

Overall, Wednesday is the best candidate for most active day because there are two economic releases along with Fed Chair Yellen’s congressional testimony, but Friday may be a busy day also due to the ISM manufacturing report. I believe it is a safe assumption that we will see movement in rates most, if not all, days this week. Because of the busy calendar, it would be extremely prudent to maintain contact with your mortgage professional if still floating an interest rate and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

Scott Wenhe
Phone: 619-255-3182 - 866-476-2494

 

[Tamalewagon]

Tuesday’s bond market has opened in positive territory even though stocks are showing strength and today’s only relevant economic news was not favorable. Stocks are showing moderate gains of 80 points in the Dow and 8 points in the Nasdaq. The bond market is currently up 2/32 (2.32%), which should improve this morning’s mortgage rates by approximately .125 of a discount point.

Yesterday’s 5-year Treasury Note auction was uneventful with the indicators pointing towards and average or slightly better demand for the securities. The bond market had little reaction to the news when results were posted at 1:00 PM ET yesterday. However, it does allow us to be a little optimistic about today’s 7-year Note sale. If it is met with a strong investor demand, we could see bond prices improve slightly this afternoon. Results will again be posted at 1:00 PM ET, so any reaction will come during early afternoon trading.

Today’s sole piece of economic data was November's Consumer Confidence Index (CCI) at 10:00 AM ET. The Conference Board announced a reading of 129.5 that exceeded forecasts and October’s revised 126.2. It was the highest reading since November 2000, meaning consumer confidence in their own financial and employment situations is at its best levels in a long time. That is bad news for bonds and mortgage rates because rising levels of confidence usually translate into stronger consumer spending that fuels economic growth. Fortunately, this is only a moderately important report that hasn’t had much of an impact on today’s trading.

Tomorrow is a pretty busy day in terms of scheduled events that may affect mortgage pricing. It begins with the first revision to the 3rd Quarter Gross Domestic Product (GDP) at 8:30 AM ET. This release is expected to show an upward revision to last month's preliminary reading of a 3.0% annual rate of growth. The GDP measures the total of all goods and services produced in the U.S. and is considered to be the benchmark measurement of economic growth. Current forecasts call for a 3.2% rate, meaning that there was a tad more economic activity during the third quarter than previously thought. This would be bad news for the bond market and mortgage rates because strengthening economic growth makes bonds less appealing to investors that hurts bond prices and mortgage rates. Unless we see a much larger increase or a downward revision, I suspect this release will have a minimal impact on mortgage rates. It is the second of three monthly updates and analysts are looking more towards the current quarter's activity than what happened during late summer and early fall.

Next up is a congressional appearance by Fed Chair Janet Yellen at 10:00 AM ET. She will be updating a joint committee on the status of the economy. These types of appearances are widely watched and can have a significant influence on the financial and mortgage markets if they yield any surprises on the strength of the economy or changes to the Fed’s monetary policy plans. Her prepared statement may be released prior to her appearance, so a reaction may come during mid-morning trading.

Later tomorrow, the Federal Reserve will release their Beige Book at 2:00 PM ET. This report is named simply after the color of its cover and details economic conditions by Fed region. That information is relied upon heavily during the FOMC meetings when determining monetary policy, so its results can influence bond trading and mortgage rates if it shows any noticeable changes from the last update. More times than not though, this report will not influence the markets enough to cause intra-day changes to mortgage rates, but the potential to do so does exist.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...

Scott Wenhe

Phone: 619-255-3182 or toll free 866-476-2494

 

[OldSchoolBoats]

Conforming loan limits raised to $453,100 for 2018!!! Woooohooo!!

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