Welcome to the TMS current mortgage rates blog. There’s some economic data out today, but first, your daily mortgage rate forecast/advice.
Click here to get today’s latest mortgage rates.
Where are mortgage rates going?
Brexit vote takes center stage
Today is the day. Britons will head to the voting polls in a few hours to decide whether or not the U.K. should remain in the European Union. Nearly all of the polls are showing an extremely close race between the Leave and Remain camps. Wall Street is betting on a Remain victory and is poised to rally if that decision comes through.
If it doesn’t, and the Leave camp comes out on top, it’s expected that there will be a decent bit of market turmoil as investors find their footing in the new territory. Either way, it’s a historic day for citizens of the U.K., and there’s no doubt that millions of people around the world are eagerly awaiting a result. Here in the Eastern U.S., we should find out the result at around 2:00 AM on Friday.
Mortgage rates will most likely rise if Britons decided to stay and fall if they choose to leave.
Click here to get today’s latest mortgage rates.
Janet Yellen speaks, says little of importance
Ms. Yellen went before the House yesterday for the second part of her semi-annual testimony. The House lawmakers usually give the Fed Chair a more thorough grilling than their colleagues in the Senate, and this time was no different. But while things did get a little testy at times, there was little that was particularly important from a mortgage rates perspective.
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10-year yield rises again
The yield on the U.S. 10-year Treasury note is continuing its climb today. Right now, it’s up two basis points from yesterday’s close at 1.71%. It’s up nearly 20 basis points from a week ago. Just like the rest of the market, the 10-year yield has the potential to be affected by the result of the Berxit vote.
Fed Fund futures unchanged
Not much has changed in the world of the Fed Fund futures. They’ve moved up a couple percentage points from where they were yesterday, possible due to strong data from the labor market. The next meeting up on the agenda is July, and the futures are giving it an 11.9% chance of a rate hike. After that, we have September, November, and December with an implied probability of a rate hike at 38.3%, 39.6%, and 56.9%, respectively.
What does this mean for me?
We’re very close to a market reaction from the Brexit vote, and therefore, there is a decent bit of risk to mortgage rates. The way I see it, the Remain camp is going to come out on top, causing mortgage rates to rise. It’s hard to topple the power of big government, and I would be very surprised if Leave gets the victory. That means that there is potentially only a short period left before rates rise. If you don’t want to take a risk, I recommend locking in a rate now. On the other hand, if you’re willing to roll the dice, then by all means, wait it out.
Click here to get today’s latest mortgage rates.
Today’s economic data:
Jobless Claims are down
Weekly jobless claims are at 259,000. That’s 11,000 below the consensus and 18,000 below the previous reading. Jobless claims are, in fact, hovering close to 43-year lows. The June Jobs Report is only a week away, and this data shows that we could be in for a strong report.
PMI Manufacturing Index
The PMI flash is at 51.4 in June, up slightly from last month’s reading. It’s not an amazing report but it is moving higher.
New Home Sales drop
New home sales sunk a disappointing 6.0% in May to 551,000.
Notable events this week:
Monday:
- Fedspeak
Tuesday:
- Janet Yellen Speaks
Wednesday:
- FHFA House Price Index
- Existing Home Sales
- Janet Yellen Speaks
- EIA Petroleum Status Report
Thursday:
- Jobless Claims
- PMI Manufacturing Index
- New Home Sales
Friday:
- Durable Goods Orders
- Consumer Sentiment
from Total Mortgage Underwritings Blog http://ift.tt/28SvrtP
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