A major step toward Trump’s tax reform was taken last night as the senate passed a budget bill. That’s causing investors to move more out of bonds and into stocks, pushing treasury yields and mortgage rates higher as we head into the weekend. Read on for more details.
Where are mortgage rates going?
Rates fall
Lawmakers in D.C. passed a budget bill last night that is being seen as a strong first step to reforming taxes in the U.S. This has created a clear risk-on sentiment in the markets with investors moving out of the perceived safety of government bonds and into riskier assets like stocks.
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The yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going) has moved about six basis points higher today up to 2.38%. That’s almost ten basis points higher than where it started the day. Typically, mortgage rates move in the same direction as the 10-year yield, so rates are dealing with some upward pressure this morning.
While rates are moving higher today, we did see in the Freddie Mac Primary Mortgage Market Survey yesterday that rates fell from the previous week. The average rate on the most popular mortgage–the 30-year fixed rate–came in at 3.88%, which is not far off from the year low.
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The other big story this week that investors are still closely watching is the race for the next Fed Chair. Current Fed Chair Janet Yellen will see her term expire in February and it’s up to President Trump to reappoint her or choose a new leader for the nation’s central bank. As it stands, it’s not looking good for Yellen, with the most recent reports showing that Fed Governor Jerome Powell as the front runner.
Powell is kind of the best of both worlds, as his similarities to Yellen should make him a shoe-in during the Senate confirmation, while his slight differences on regulation and monetary policy lean more toward Trump’s liking.
What does this mean for me?
Great time to lock in a rate
Mortgage rates are moving higher but are still on the lower end of the spectrum for 2017. If you’re thinking about purchasing a new home or refinancing your current mortgage, there are plenty of opportunities to get a great deal right now.
One of the best places to start is to find out what your custom rate would be, which you can do by calling one of our mortgage specialists or by filling out a quick from with our Mortgage Builder.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
Existing Home Sales
Existing Home Sales came in at 5.390 M for September. That’s a monthly change of 0.7%, putting the year over year change at -1.5%.
Fedspeak
Fed Chair Janet Yellen will speak at 7:30pm.
Notable events this week:
Monday:
- Empire State Mfg Survey
- Fedspeak
Tuesday:
- Import and Export Prices
- Industrial Production
- Housing Market Index
Wednesday:
- Fedspeak
- Housing Starts
- EIA Petroleum Status Report
- Beige Book
Thursday:
- Jobless Claims
- Philly Fed Business Outlook Survey
Friday:
- Existing Home Sales
- Fedspeak
from Total Mortgage Blog http://ift.tt/2yxlVYw
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