Tuesday, July 11, 2017

What's going on and why does it matter? Mortgage bond prices opened lower today as the 100-day moving average has been operating as a formidable ceiling of technical resistance. Bond prices failed to rally above that critical level yesterday in spite of heavy purchases by the Federal Reserve.  The Fed is scheduled to purchase up to $1.05 billion of GNMA mortgage bonds today, but they won't be buying any mortgage bonds tomorrow due to Fed Chair Yellen's scheduled testimony before Congress. Although most of this week's economic reports are slated for Thursday and Friday, we can have the JOLTS report and the wholesale sales numbers scheduled for release later this morning. What should you do about it? Lock your rate to be safe, especially while mortgage bonds continue to trade below their 100-day moving average. ..... Economic reports that may impact mortgage rates this week: Date Report Period Prior Estimate Actual Tue 11 Jul JOLTS Job Openings May 6.04M 5.95M Tue 11 Jul Wholesale Inventory May -0.5% 0.3% Tue 11 Jul Wholesale Sales May -0.4% 0.2% Thu 13 Jul Initial Jobless Claims Week of July 3 248,000 245,000 Thu 13 Jul PPI June 0.0% 0.0% Fri 14 Jul Core CPI June 0.1% 0.2% Fri 14 Jul Real Weekly Earnings June 0.3% 0.0% Fri 14 Jul Retail Sales June -0.3% 0.1% Fri 14 Jul Industrial Production June 0.0% 0.3% Fri 14 Jul Capacity Utilization June 76.6% 76.7% Fri 14 Jul Mfg. Output June -0.4% 0.2% Fri 14 Jul Business Inventories May -0.2% 0.3% Fri 14 Jul U of Mich. Consumer Sentiment July 94.5 95.0