Yesterday, the FOMC minutes from their September meeting failed to stir financial market participants into any new positions, keeping mortgage rates relatively flat for another day. That trend is continuing today. Tomorrow is the most data-intensive day, including CPI and Retail Sales, so we could see rates adjust once those reports are released. Read on for more details.
Market Outlook 10.9.17 from Total Mortgage on Vimeo.
Where are mortgage rates going?
Rates continue to barely move this week
So far this week there hasn’t been any news or economic data strong enough to push mortgage rates too far in either direction. Yesterday, we got the FOMC minutes from their September meeting.
Financial market participants always key into the minutes for clues about the upcoming policy decisions. The takeaway from the minutes yesterday for most investors is that yes, there is still some concern over inflation, but most members of the FOMC believe that further tightening will be necessary in the near-term.
Click here to get today’s latest mortgage rates (Oct. 12, 2017).
Some Fed officials did make the case that more economic data needs to be seen before finalizing a decision to raise rates, but that doesn’t seem to be bothering investors, who still largely believe that a quarter point increase to the federal funds rate will happen in December (86.7% chance according to CME Group’s Fed Funds futures).
Looking at the yield on the 10-year Treasury note (which is the best market indicator of where mortgage rates are going) we can see that there wasn’t much of a reaction to the minutes.
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On the week, the 10-year yield is down about three basis points. Typically, mortgage rates move in the same direction as the 10-year yield.
Freddie Mac Primary Mortgage Market Survey
The Freddie Mac PMMS came out this morning, as it does nearly every Thursday at 10:00am, and showed that mortgage rates edged a little higher this week. Here are the numbers:
- The average rate on a 30-year fixed rate mortgage moved up to 3.91%
- The average rate on a 15-year fixed rate mortgage is now 3.21%
- The average rate on a 5/1-year adjustable rate mortgage is at 3.16%
This is the thirteenth consecutive week that the average rate on the 30-year fixed rate has stayed below 4.00%. However, with the Fed getting ready to raise the Nation’s benchmark interest rate in December, the long-term trend does appear to be for rates to gradually rise over the coming weeks.
What does this mean for me?
The time to act is now
With mortgage rates continuing to run on the lower end of the spectrum for 2017, right now is a great time to find out what your custom rate would be and lock if you like what you see.
Given that rates could rise over the coming weeks and months, it makes sense for borrowers to take action sooner rather than later. It only takes a few minutes with our Mortgage Builder to get a clear picture of your home financing situation.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
Jobless Claims
Applications for U.S. unemployment benefits came in at 243,000 for the week of 10/7/17. That’s down from the prior week’s revised reading of 258,000. The four-week moving average is now at 257,500.
PPI-FD
Producer prices came in as expected for September with a monthly gain of 0.4%, putting the year over year reading at 2.6%. PPI-FD less food and energy also came in at 0.4%, month over month, putting it at 2.2% year over year. PPI-FD less food, energy, and trade services rose 0.2%, which is also exactly what analysts had predicted, putting the year over year reading at 2.1%.
EIA Petroleum Status Report
- 11:0am
Fedspeak
- Fed Governor Lael Brainard at 10:30am
- Fed Governor Jerome Powell at 10:30am
- Atlanta Fed President Raphael Bostic at 9:15pm
Notable events this week:
Monday:
- Nothing – Bond Market Closed for Columbus Day
Tuesday:
- Fedspeak
Wednesday:
- Fedspeak
- JOLTS
- FOMC Minutes
Thursday:
- Jobless Claims
- PPI-FD
- EIA Petroleum Status Report
- Fedspeak
Friday:
- Consumer Price Index
- Retail Sales
- Fedspeak
- Business Inventories
- Consumer Sentiment
from Total Mortgage Blog http://ift.tt/2zjbC8n
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