Here comes the first week of 2018. Mortgage rates are dealing with some mild upward pressure today after some positive economic data. The biggest thing to keep your eye on this week is the monthly jobs report on Friday. That report always has the potential to cause some ripples in the mortgage market. Read on for more details.
Where are mortgage rates going?
Rates up a little
Here we go with another week and another year. Mortgage rates are dealing with some mild upward pressure as we kick things off, but it’s by no means a major shift higher.
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The adjustment seems to be happening in part because of the PMI Mfg index for December, which came in at a 55.1. That’s a couple points higher than the prior month’s reading, increasing investors optimism.
Optimistic market participants are more likely to take money out of government bonds and put it into riskier assets such as stocks. This pushes Treasury yields, which are closely tied to mortgage rates, higher.
If we take a look at the yield on the 10-year Treasury note (the best market indicator of where mortgage rates are going), we can see that it’s up almost four basis points today.
Mortgage rates typically move in the same direction as the 10-year yield, and so they’re dealing with some upward pressure this morning. Looking at the economic calendar for the rest of the week, we do have several opportunities for mortgage rates to adjust.
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The most likely adjustment will occur on Friday morning when the Employment Situation (a.k.a. the monthly jobs report) gets released. That report is always one of the most closely watched data releases every month, and there’s little reason to believe this time around will be different.
Analysts are expecting the report to show that 190,000 private sector jobs were added in December. So that’s the benchmark that investors will be looking for the headline reading to hit.
The thing to watch out for here is a reading that comes in well below or above the target of 190,000. Since financial market participants try to position themselves according to these forecasts, if the number doesn’t align with the outcome, they’re forced to reevaluate and readjust their positions.
Rate/Float Recommendation
Lock now
Mortgage rates are expected to rise throughout 2018. Given that expectation, we think that it makes sense for most borrowers to try and lock in a rate sooner rather than later. You can get started online by following the link below, or on the phone with a quick call to one of our mortgage specialists.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
PMI Manufacturing Index
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Notable events this week:
Monday:
Tuesday:
- PMI Manufacturing Index
Wednesday:
- ISM Mfg Index
- Construction Spending
- FOMC Minutes
Thursday:
- ADP Employment Report
- Jobless Claims
- PMI Services Index
- EIA Petroleum Status Report
- Fedspeak
Friday:
- Employment Situation
- International Trade
- Factory Orders
- ISM Non-Mfg Index
- Fedspeak
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from Total Mortgage Blog http://ift.tt/2CEyFMK
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