Tuesday, August 15, 2017

What's going on and why does it matter?

Mortgage bonds opened lower this morning as tensions continue to ease between the US and North Korea. Also, NY Fed President Dudley indicated in a speech yesterday afternoon that the Fed is on track to increase short-term rates later this year if the economy continues to improve. Today's economic reports seem to confirm this, with the NY Fed "Empire State" Manufacturing Index more than doubling, and retail sales also coming in much stronger than market expectations. It seems like mortgage bond prices may fall back down to their moving averages. The Fed is scheduled to purchase up to $1.65 billion of 30-year conventional mortgage bonds today, which may help.

What should you do about it?Lock your rate to be safe.

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MBS Chart

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Economic reports that may impact mortgage rates this week:

DateReportPeriodPriorEstimateActual
Tue
15 Aug
NY Fed
Mfg. Index
Aug9.810.025.2
Tue
15 Aug
Retail SalesJul0.3%0.4%0.6%
Tue
15 Aug
Business
Inventories
Jun0.3%0.4%
Wed
16 Aug
Building
Permits
Jul1.275M1.25M
Wed
16 Aug
Housing
Starts
Jul1.215M1.22M
Wed
16 Aug
Fed
Minutes
Jul--
Thu
17 Aug
Initial Jobless
Claims
Week of
Aug 7
244,000240,000
Thu
17 Aug
Industrial
Output
Jul0.4%0.3%
Thu
17 Aug
Capacity
Utilization
Jul76.6%76.7%
Thu
17 Aug
Manuf.
Output
Jul0.2%0.2%
Fri
18 Aug
U of Mich.
Consumer
Sentiment
Aug93.494.0

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