Welcome to the Total Mortgage Current Mortgage Rates Blog. There’s some economic data out today, but first, your daily mortgage rate forecast/advice.
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Where are mortgage rates going?
Stronger inflation data (CPI, Industrial Production, Beige Book) out yesterday pushed up treasury yields, driving mortgage rates higher. That trend is continuing today after the European Central Bank announced today that they are making no adjustments to their benchmark interest rate and bond-buying program.
The yield on the 10-year U.S. treasury note (the best market indicator of where mortgage rates are going) is now up to 2.48%, which is 5 basis points above where it closed yesterday. Yesterday alone the 10-year yield rose 6.4 basis points–its largest single day gain since December 9th.
Click here to get today’s latest mortgage rates.
Pundits are speculating that if this inflation data persists, more pressure will be put on the Federal Reserve to increase the pace with which they raise their benchmark interest rate this year. It might be a little early to say for sure if that will happen, but the dialogue is certainly there right now.
The Fed Fund futures is still showing June as the next meeting with a greater than 50% chance of a rate hike, but the odds for May aren’t far off from that mark. There’s lots of economic data to sift through between now and then, though, and anything could happen.
Mortgage rates are rising right now, and I believe that will be the long-term trend, but that doesn’t mean the markets won’t hit some turbulence over the next few weeks (months). After all, we’re only one day away now from Donald Trump’s inauguration as the 45th president of the United States, and no one really knows what will unfold with Trump at the helm.
Mortgage rates slide for 3rd straight week in PMMS
The Freddie Mac Primary Mortgage Market Survey (PMMS) got released this morning at 10am (as it does every week), and it’s showing that mortgage rates fell for the third consecutive week. The average rate on a 30-year fixed rate mortgage is now 4.09% (0.5 points); the average rate on a 15-year fixed rate mortgage is 3.34% (0.5 points); the average rate on at 5-year ARM is 3.21% (0.4 points). Data for the survey is collected early on in the week and does not reflect the current rise due to yesterday’s inflation readings.
Here is what Chief Economist at Freddie Mac Sean Becketti said about mortgage rates this week:
“After trending down for most of the week, the 10-year Treasury yield rose following the release of the CPI report. In contrast, the 30-year mortgage rate fell three basis points to 4.09 percent, the third straight week of declines.”
Usually Becketti’s statements are pretty spot on, but this week’s is slightly misleading. The way he says it, it appears as if mortgage rates declined after the release of the CPI report. That’s not the case. As stated, data for the report is mostly collected on Monday and Tuesday and really does not reflect the market changes that happened after the release of the CPI report on Wednesday.
Click here to get today’s latest mortgage rates.
What does this mean for me?
Mortgage rates are headed higher, and I expect them to continue to do so in the long-run. Borrowers who are looking to refinance their current mortgage or purchase a home are most likely going to be better off acting sooner rather than later.
Today’s economic data:
Housing Starts
Housing starts for December came in at 1.226 M. That’s just above economists’ expectations for 1.200. Housing permits came in at 1.210 M, which is below the 1.230 M that economists had predicted.
Jobless Claims
Jobless claims for the week of 1/14 came in at 234,000. That’s 15,000 down from the previous week’s revised reading. The 4-week moving average is now 246,750. So far the numbers are lining up for a solid January jobs report.
Philly Fed Outlook
The Philly Fed General Business Conditions Index shot up 3.9 points to 23.6 for January. That’s reflecting very strong gains in all aspects of the report. New orders, unfilled orders, employment, etc. Everything seems to be firing on all cylinders at the moment.
EIA Petroleum Report
For the week of 1/13:
- Crude oil: 2.3 M barrels
- Gasoline: 6.0 M barrels
- Distillates: -1.0 M barrels
Fedspeak
- San Francisco Fed President John C. Williams at 10am.
- Fed Chair Janet Yellen at 8pm.
Click here to get today’s latest mortgage rates.
Notable events this week:
Monday:
- Markets Closed: Martin Luther King Jr. Day
Tuesday:
- Fedspeak
Wednesday:
- Consumer Prices Index
- Industrial Production
- Fedspeak
Thursday:
- Housing Starts
- Jobless Claims
- Philly Fed Outlook
- EIA Petroleum Report
- Fedspeak
Friday:
- Fedspeak
- Trump Inauguration
from Total Mortgage Underwritings Blog http://ift.tt/2jcHgM0
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