Happy Friday, and welcome to the TMS current mortgage rates blog. There’s some economic news out today, but first, your mortgage rate forecast/advice.
Where are mortgage rates going?
It’s been a slow week. The Fed’s media blackout has left us with only economic data to talk about, and there really hasn’t been significant data out this week. Next week should be a little more exciting with the FOMC meeting. Starting on Tuesday and ending on Wednesday, everyone is looking to see how Fed officials have adjusted their thinking since the labor market got crushed in the May jobs report.
Should financial market participants be anticipating a hike in July? The Fed has made it clear that every meeting is “live”, in that they can raise rates, so the fact that July doesn’t have a post-meeting press conference with the monetary policy monarch Janet Yellen doesn’t necessarily mean anything. It actually could be the chance for the Fed to prove that every meeting is indeed live.
Personally, I don’t think that there is enough data between now and then to turn things around quickly enough to warrant a hike in July. The labor market would have to really turn things around fast and come out with a stellar June jobs report (with upward revisions to past months) to restore confidence in the minds of the FOMC members.
Of course, I don’t think think the plausibility of a July hike will stop some Fed officials from attempts to jawbone their way into a new reality. I wouldn’t even be surprised if we see that Esther George still votes to raise rates on Wednesday.
Freddie Mac says rates are lower
Turning back to the present, the Freddie Mac Primary Mortgage Market Survey (PMMS) showed that mortgage rates moved lower this week. The drop was due to it being the first PMMs since the May jobs report last Friday. Everyone knew that rates had dropped, it was only a matter of how low they would go.
- The average rate on a 30-year fixed mortgage dropped 6 basis points to 3.60%.
- The average rate on a 15-year fixed fell 5 basis points to 2.87%.
- The average rate on a 5-year ARM slid 6 basis points to 2.82%.
- All had 0.5 points.
Click here to get today’s latest mortgage rates.
Click here to get today’s latest mortgage rates.
U.S. 10-year Treasury Note moves lower
Investors have been flocking to safe assets like government bonds in countries across the globe, pushing government bond yield prices down. The yield on the U.S. 10-year Treasury note started the week at 1.74%. It’s currently trading at 1.63%, which is down to multimonth lows and is only 10 basis points above the 1-year low. Mortgage rates tend to go wherever the 10-year yield goes so that’s good news for borrowers.
Fed Fund futures
The Fed Fund futures haven’t really moved all week. December is still the only meeting with more than a 50% chance of a rate hike at 60%. What comes out of the Fed on Wednesday will be the next biggest influencer. I imagine the Fed will try to come off slightly hawkish, and we’ll see the futures rise.
What does this mean for me?
I’ve been saying it all week–right now is a good time to be a borrower. Mortgage rates are back around 3-year lows, meaning there’s plenty of opportunities to refinance and save on your monthly payments, or to lock in a low rate for 15 or 30 years down the road. All it takes to get started is a phone call. So put that smartphone to use and dial us up.
Click here to get today’s latest mortgage rates.
Today’s economic data:
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Consumer Sentiment
- Consumer sentiment is at 94.3 for the June flash. That’s only 0.3 lower from the previous reading, and 0.2 below the consensus. Unfortunately for the FOMC, inflation expectations are still very low.
Click here to get today’s latest mortgage rates.
Miscellanea:
- If you missed it, the latest sign that we’re living in a bizarro reality happened yesterday when Hillary Clinton responded to a twitter jab from The Donald by tweeting back “Delete your account.” It’s only going to get more entertaining from here.
- The Euro Cup kicks off today. It’s the second biggest soccer event after the World Cup. The tournament has 24 countries battling for the title over a one month span. I’m excited.
Notable events this week:
Monday:
- Janet Yellen speaks
Tuesday:
- Productivity and costs
- 3-Year Treasury auction
Wednesday:
- Job openings and labor turnover survey
- EIA petroleum status report
- 10-Year Treasury auction
Thursday:
- Weekly Jobless Claims
- 30-Year Treasury auction
Friday:
- Consumer Sentiment
from Total Mortgage Underwritings Blog http://ift.tt/1rgxgo4
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