Stocks and slumping and government bonds are rallying, causing mortgage rates to move lower today. We get some important news tomorrow about the Republican tax reform bill, so rates could adjust then. Given that mortgage rates are currently down, it’s a great time for borrowers to lock. Read on for more details.
Market Outlook 11.13.17 from Total Mortgage on Vimeo.
Where are mortgage rates going?
Rates trending lower
Mortgage rates are moving lower today. Stocks are in a bit of a slump, causing more investors to move into government bonds, pushing Treasury yields lower.
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Mortgage backed securities compete for similar investors as government bonds and therefore have to adjust their yields accordingly, causing mortgage rates to fall.
Today was the most data-heavy day of the week and we didn’t really get anything that was positive enough to bolster investor optimism. Tomorrow is another data-heavy day, so there’s definitely the potential for some market action there.
Of course, we’re also keeping an eye on the unfolding situation around the Republican tax reform plan. It’s mostly been a game of wait-and-see as we await tomorrow’s vote by House Republicans.
Right now, the words out of Capitol Hill is that despite some resistance from a few Republicans, the vote will result in the bill’s passage. That would be a major step-forward for the bill, and would likely spark a rally in stocks as investors become more optimistic that the tax cuts will take place.
With more investors going into riskier assets like stocks, that means less in bonds, pushing Treasury yields and mortgage rates higher. It’s not set in stone, though, so you’ll have to check in tomorrow to find out what happens.
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Rate/Float Recommendation
Lock now
Mortgage rates are heading lower today. This is a dip that isn’t expected to last, which is why we’re recommending that borrowers lock in a rate on a purchase or refinance sooner rather than later.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
Consumer Price Index
CPI for October ticked up 0.1%, which is right in line with analysts’ expectations. That brings it up to a yearly change of 2.0%. CPI less food and energy rose 0.2% in October, putting it at 1.8%year over year. We’re looking at modest increases that aren’t enough to really bolster investor optimism.
Retail Sales
Retail sales rose 0.2% in October. That’s one tenth above what analysts had projected. Retail sales less autos rose one tenth less than what was projected at 0.1%. Retail sales less autos and gas also came in a tenth under expectations at 0.3%. The control group rose 0.3%.
Empire State Mfg Survey
The Empire State General Business Conditions Index came in at 19.4 for November. That’s a decent slowdown from the 30.2 that was posted in October, and it’s lower than the 26.0 that was projected.
Business Inventories
Business inventories were unchanged for September.
EIA Petroleum Status
For the week of 11/10/17:
- Crude oil: 1.9 M barrels
- Gasoline: 0.9 M barrels
- Distillates: -0.8 M barrels
Fedspeak
Boston Fed President Eric Rosengren at 4:00pm.
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Notable events this week:
Monday:
- Nothing
Tuesday:
- Fedspeak
- PPI-FD
Wednesday:
- Consumer Price Index
- Retail Sales
- Empire State Mfg Survey
- Business Inventories
- EIA Petroleum Status
- Fedspeak
Thursday:
- Jobless Claims
- Philly Fed Business Outlook Survey
- Import and Export Prices
- Industrial Production
- Fedspeak
Friday:
- Housing Starts
- Kansas City Fed Manufacturing Index
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from Total Mortgage Blog http://ift.tt/2z5q478
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