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?
U.S. markets couldn’t continue their four-day rally yesterday as investors fled equities in favor of the safety of government bonds. It seemed as though financial market participants relapsed with a case of the Brexit jitters. No one knows what will happen, so the move is the kind of emotional, herd-mentality type trading that is not uncommon in these situations. Today, all of the major market indexes are still trading in the red.
The best chance for some sustained relief comes later this week with the June jobs report on Friday.
Click here to get today’s latest mortgage rates.
10-year yield plummets to record lows
Last Friday, the yield on the U.S. 10-year Treasury note poked its head above 1.50% for the first time since the Brexit. Since then, it bottomed out at a new record low close of 1.375%. This morning, it got as low as 1.32% before rallying up to its current position of 1.37%. The more investors purchase a bond, the price moves higher and the yield moves lower, so the rush to bonds this week shot the yield down. Historically, mortgage rates have shown a tendency to follow the path of the 10-year yield, so this drop means that rates are most likely moving lower.
Fed Fund futures
The Fed Fund futures look only slightly better than where they were last week. December is still the best candidate for a rate hike in 2016 with a 17.8% chance. That’s not saying much, though, as all of the other meetings have less than a 10% chance of rates moving higher than their current level of 0.25%-0.5%.
What does this mean for me?
Mortgage rates are not that far from all-time lows. It doesn’t take long to pick up the phone and call to see if you can save money on a refinance, so I highly recommend that do you that. If you’re trying to purchase a home, now is a great time to lock in a low rate for years to come. The market is very volatile right now so there’s really no telling when mortgage rates will spike back up.
Click here to get today’s latest mortgage rates.
Today’s economic data:
International Trade Gap Widens
The U.S. trade deficit widened to $41.1 billion in May. The consensus was for a deficit of $40.0 billion. The prior reading was $-37.4 billion.
Fed Minutes
The FOMC minutes from their June meeting are set to be released today at 2:00 PM. A lot has changed in global and domestic markets since that meeting concluded, making the minutes slightly less important as usual.
Fedspeak
New York Fed President William Dudley came out with dovish remarks yesterday when he spoke to an economic roundtable in Binghamton, New York. He noted that inflation was still running below the Fed’s mandate of 2.00%, which gives time for the Fed to see what happens with the current monetary policy.
Fed Governor Daniel Tarullo spoke this morning and also noted that inflation is not where they would like it to be. He said that he thinks any future rate hikes should be on hold until there is convincing evidence that inflation will rise above their target level.
Notable events this week:
Monday:
- Markets closed – Independence Day
Tuesday:
- Factory Orders
- Treasury auctions
- Fedspeak
Wednesday:
- International Trade
- Fed Minutes
- Fedspeak
Thursday:
- ADP Employment Report
- Weekly Jobless Claims
- EIA Petroleum Status Report
Friday:
- Nonfarm Payrolls
from Total Mortgage Underwritings Blog http://ift.tt/29hueHl
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