Welcome to the TMS current mortgage rates blog. There’s some economic news out today, but first, your mortgage rate forecast/advice.
Click here to get today’s latest mortgage rates.
Where are mortgage rates going?
Janet Yellen Softens Rate Hike Position
Federal Reserve Chairwoman, Janet Yellen, spoke yesterday at the World Affairs Council of Philadelphia on the future of U.S. monetary policy. With the dismal May jobs report this past Friday, financial market participants were eager to tune in and hear what position the Fed Chief would now take. She opened off her remarks by trying to downplay the fact that only 38,000 jobs were added in May, noting that one should never “put too much emphasis” on any single piece of monthly data.
No doubt, Yellen and her colleagues are certainly praying that the report is an anomaly and that June will show a return to a strengthening labor market. Her optimism eventually gave way to a realistic acceptance that the future is much more cloudy than previously thought. She explicitly cited the Brexit, global growth, and productivity as uncertainties that the Fed are carefully watching. All in all, her position is decidedly softer, as she stated that a gradual path is still appropriate, but has now opted out of claiming it will happen in the “coming months”.
Treasury yields went down while Yellen was talking, but reversed course after her speech concluded. In the end, the market reaction was limited. The yield on the U.S. 10-year Treasury note currently sits at 1.71%, which is down 3 basis points from yesterday’s close. It’s basically been unchanged since it dropped after the jobs report on Friday. Mortgage rates have a tendency to follow the direction of the 10-year yield, so it’s quite possible we will be seeing rates back down at 3-year lows in the Freddie Mac PMMS this week.
The Fed fund futures, which reflects the market’s belief in the likelihood of a rate hike, is currently giving June a 2% chance. After that, we have July, September, November, and December at 23%, 46%, 48%, and 66%, respectively. The Federal Reserve is entering its blackout stage before the meeting next week, so those numbers are likely to remain fairly constant until Wednesday when the meeting concludes.
What does this mean for me?
It’s good news. Rates are low, and they’re probably going to stay low for quite some time. Now is a great time to call and see if you can save on your monthly mortgage payments with a refinance, or to lock in a low rate for years to come.
Click here to get today’s latest mortgage rates.
Today’s economic data:
Productivity and costs remain weak
- The second estimate for second-quarter productivity came in at minus 0.6%.
- Labor cost estimates for second-quarter came in at 4.5%.
3-Year Treasury auction
- There is a 3-year note auction today at 1:00 PM.
Click here to get today’s latest mortgage rates.
Miscellanea:
- Across the pond, David Cameron has been ramping up his rhetoric against the Brexit, and Boris Johnson is having none of it. Along with fellow “remain” campaigner Michael Gove, he has challenged David Cameron to a face-to-face debate. With the referendum drawing closer and the leave side getting the edge, things are really heating up.
- Hillary Clinton has now clinched enough delegates for the Democratic nomination. We’re getting closer and closer to an official Clinton vs. The Donald showdown. It’s a strange world.
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/1YcOJel
No comments:
Post a Comment