Friday, June 2, 2017

What's going on and why does it matter?
 

Mortgage bonds are trading higher today after the highly anticipated non-farm payrolls report came out much weaker than market expectations.  Weakness in the economy often causes mortgage pricing to get better. The employment numbers for last month were also revised down. This runs contrary to yesterday's stronger than expected ADP employment numbers, so the market may get volatile based on these mixed signals. The Fed will be very supportive of the mortgage markets today with a scheduled purchase of up to $1.625 billion of 30-year conventional mortgage bonds.

What should you do about it?

 
Watch for mortgage bonds to close above their 200-day moving average; but be prepared to lock your rate if bonds break back below that critical level.

Economic reports that may impact mortgage rates this week:

Date	Report	Period	Prior	Estimate	Actual
Tue 30 May	Personal Income	Apr	0.2%	0.4%	0.4%
Tue 30 May	Core PCE Price Index	Apr	-0.1%	0.1%	0.2%
Tue 30 May	Consumer Confidence	May	120.3	119.8	117.9
Thu 1 Jun	ADP National Employment	May	174,000	180,000	253,000
Thu 1 Jun	Initial Jobless Claims	Week of May 22	234,000	238,000	248,000
Thu 1 Jun	Construction Spending	Apr	-0.2%	0.5%	-1.4%
Thu 1 Jun	ISM Mfg. PMI	May	54.8	54.6	54.9
Thu 1 Jun	Total Vehicle Sales	May	16.88M	16.9M	16.66M
Fri 2 Jun	Non-Farm Payrolls	May	174,000	182,000	138,000
Fri 2 Jun	Average Earnings	May	0.2%	0.2%	0.2%