Here comes another week. It should be a busy one with lots of economic data and other events to keep an eye on. We are seeing some upward pressure on mortgage rates at the start of trading today, as investors continue to sell government bonds.
If you’re looking to purchase a home or refinance your current mortgage, we’re recommending that you take action sooner than later. Read on for more details.
Where are mortgage rates going?
Rates looking to finish the week flat
We’re starting off the week with a bang as U.S. bond yields spiked higher in early trading.
The yield on the 10-year U.S. Treasury note (which is the best market indicator of where mortgage rates are going) shot up almost seven basis points, bringing it up over 2.7% for the first time since 2014.
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Mortgage rates typically move in the same direction as the 10-year yield, so we’re seeing some upward pressure on rates as we begin the week. It should be noted, though, that at this time the 10-year yield has come down a couple points off of its intraday peak, but the shift higher is certainly there.
There is certainly the potential for this week to be a busy one. Tomorrow night we have President Trump’s State of the Union address. The spotlight will definitely be there for Trump, and as we’ve seen, he has a knack for saying things with global consequences.
What he will say tomorrow night is anyone’s guess, it’s looking like he will strike a diplomatic tone and avoid any inflammatory remarks. This would soften any effects on the mortgage market.
We’ve got the Federal Open Market Committee announcement on Wednesday, which shouldn’t be that eventful on the monetary policy front.
Some analysts are calling for a more hawkish adjustment to the Fed’s outlook, but whether or not that will actually happen is another thing. There is a general agreement, however, that the Fed will reinforce the notion of three rate-hikes in 2018.
If they don’t do that, that’s when we start to get into a big market reaction. It seems unlikely, but you’ve always got to keep an eye out for surprises.
After the Fed meeting, financial market participants will be looking ahead to Friday’s Employment Situation report (a.k.a. the monthly jobs report). That’s always one of the biggest market movers every month and this time around should be no different.
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Rate/Float Recommendation
Lock now before rates get any higher
Mortgage rates are poised to continue their gradual increases throughout 2018. We’ve already seen the average rate on the 30-year fixed rate mortgage move up 20 basis points in the Freddie Mac Primary Mortgage Market Survey.
Given this expectation for current mortgage rates, we think that the best bet for most borrowers is to lock in a rate now. It only takes a few minutes online or a quick phone call to a loan officer to get started.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
Personal Income and Outlays
The latest PIC report is out with data for December. It’s showing personal income up 0.4%. Consumer spending is also up 0.4%. The PCE Price Index rose 0.1%, month over month, putting it at 1.7%, year over year. Core PCE ticked up 0.2%, month over month, bringing it to 1.5%, year over year.
Dallas Fed Mfg Survey
The Dallas Fed Mfg Survey moved off of an 11-month high today to a 16.8 reading for January.
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Notable events this week:
Monday:
- Personal Income and Outlays
- Dallas Fed Mfg Survey
Tuesday:
- FOMC Meeting Begins
- S&P Corelogic Case-Shiller HPI
- Consumer Confidence
- President Trump State of the Union Address
Wednesday:
- ADP Employment Report
- Employment Cost Index
- Chicago PMI
- Pending Home Sales Index
- EIA Petroleum Status Report
- FOMC Meeting Announcement
Thursday:
- Jobless Claims
- Productivity and Costs
- PMI Manufacturing Index
- ISM Mfg Index
- Construction Spending
Friday:
- Employment Situation
- Consumer Sentiment
- Factory Orders
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from Total Mortgage Blog http://ift.tt/2GtvAAS
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