Last week brought a mixed bag of economic news.  Mortgage rates rose slightly last week, trading was calm as many were on summer vacations.  It will be worth returning from vacation for this week as lots of items are on the economic calendar.

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This week expect lots of rate volatility starting on Tuesday when consumer confidence numbers are released.  Other market moving items on the calendar include GDP, Fed adjournment, Payroll data, unemployment rate and PCE prices.

Keep thing is prospective when thinking about locking a rate.  Rates remain low and it is still a great time to purchase or refinance a home

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What's Ahead For Mortgage Rates This Week April 21 2013
Last week mortgage rates remained basically unchanged.  During he last two weeks the bond and mortgage markets have stayed in a narrow range. The 10 yr Treasury note, driver for mortgage rates, has been confined in a 6 bp range from 1.75% to 1.69%. The note has been unable to break strong resistance at 1.69% resulting in mortgage rates remaining about unchanged since early April. Interest rate markets are driven these days by each move in the key stock indexes; that market has experienced increased volatility but interest rates haven’t shown much change, remaining in their tight ranges. This week 170 of the S&P 500 will report earnings, Q2 earnings so far have shown a mixed picture, some good others not meeting expectations. Expect continued high volatility in the equity markets this week. If the 10 yr note exceeds 1.75% on a closing basis, interest rates will likely edge higher

Whats Coming Up Next

Date Time (ET) Statistic For Market Expects
04/22/13 10:00:00 AM Existing Home Sales Mar 5.01M
04/23/13 09:00:00 AM FHFA Housing Price Index Feb NA
04/23/13 10:00:00 AM New Home Sales Mar 415K
04/24/13 08:30:00 AM Durable Orders Mar -3.10%
04/25/13 08:30:00 AM Initial Claims 04/20/13 351K
04/26/13 08:30:00 AM GDP-Adv. Q1 2.80%
04/26/13 08:30:00 AM Chain Deflator-Adv. Q1 1.60%
04/26/13 09:55:00 AM Michigan Sentiment – Final Apr 72.4

 

This week the bond and mortgage markets will likely be slightly weaker resulting in slightly higher mortgage rages.

 

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What's Ahead For Mortgage Rates - April 15 2013Mortgage rates saw little change last week amidst mixed economic news.

Treasury auctions held on Tuesday, Wednesday and Thursday saw weak demand; this could have been caused by the FOMC minutes that were released on Wednesday.  The minutes indicated that some FOMC members supported ending the current quantitative easing (QE) program within a few months.

Over the weekend more rumblings from N. Korea refusing to enter discussions with the US on ending its nuclear bomb development. Tensions between the US, S. Korea and N. Korea remain at high levels, although most intelligence reports indicate the country does not yet have enough weapons grade plutonium to develop a bomb that could reach the US, but does have a small nuke missile that could reach Guam. Meanwhile, although there is reason to be concerned about N. Korea’s belligerence, global markets are not showing much concern so far. Technically the bond and mortgage markets continue to support higher prices and lower yields. Traders continue to play the stock market against treasuries; as long as stock indexes are weaker money will flow into treasuries, higher stock indexes pressure the bond market.

Whats Coming Up Next?

This week, unlike last week markets have a number of key economic measurements. March housing starts and permits, the April NAHB housing market index, March industrial production and factory use, the Philly Fed business index and the Fed will release its Beige Book. The Book is the staff report on the economy frm each of the 12 Fed districts and is used by the FOMC when it meets on May 1st.

Date Time (ET) Statistic For Market Expects
04/15/13 10:00:00 AM NAHB Housing Market Index Apr 45
04/16/13 08:30:00 AM CPI Mar -0.10%
04/16/13 08:30:00 AM Core CPI Mar 0.20%
04/16/13 08:30:00 AM Housing Starts Mar 930K
04/16/13 08:30:00 AM Building Permits Mar 945K
04/16/13 09:15:00 AM Industrial Production Mar 0.30%
04/16/13 09:15:00 AM Capacity Utilization Mar 78.40%
04/17/13 02:00:00 PM Fed’s Beige Book Apr NA
04/18/13 08:30:00 AM Initial Claims 04/13/13 355K
04/18/13 10:00:00 AM Philadelphia Fed Apr 2.5
04/18/13 10:00:00 AM Leading Indicators Mar 0.00%

 

We expect an increase in volatility this week, rates should continue lower however each data point this week has the potential to swing markets.

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Federal Jobs Report Shows Robust Job Growth April 2013The Bureau of Labor Statistics (BLS) issued its Job Openings and Labor Turnover report for February on Tuesday, April 9th, 2013..

The data was mixed with preliminary figures for all non-farm jobs increasing from 3.62 million jobs in January to 3.93 million jobs in February.

This was the highest month-to- month increase in jobs since May 2008.

Non-farm jobs increased by 399,000 jobs from 3.53 million in February 2012 to 3.93 million jobs in February 2013, an increase of 10.2 percent year-over-year.

More Jobs Means More Opportunities For Home Ownership

More jobs generally means higher incomes and stability which enable more families to buy homes and qualify for mortgage loans.

Hires between January and February 2013 rose from 4.30 million to 4.43 million hires, an increase of 2.70 percent.

Hires between February 2012 and February 2013 fell from 44.9 million to 44.2 million, a decrease of 1.6 percent.

Total non-farm job separations changed little month to month, and remained exactly the same year-over-year at 4.20 million separations.

Numbers of hires and separations surpass job numbers due to workers being hired on and/or separated from more than one job during the reporting period.

Regional Non-Farm Employment Shows Job Growth

  • Northeast: Non-farm jobs fell from 688,000 jobs in January 2013 to 647,000 jobs in February 2013, but increased year-over-year from 589,000 jobs to 647,000 jobs.
  • South:  Non-farm Jobs fell from 1.56 million jobs in January 2013 to 1.50 million jobs in February 2013. Jobs increased year-over-year from 1.34 million jobs in February 2012 to 1.47 million jobs in February 2013.
  • Midwest: Non-farm jobs grew from 712,000 in January 2013 to 780,000 jobs in February 2013 and increased from 740,000 jobs to 780,000 from February 2012 to February 2013.
  • West: Non-farm jobs increased from 806,000 to 830,000 between January and February 2013; on a year-over-year basis, jobs showed noteworthy growth from 650,000 jobs to 830,000 jobs between February 2012 and February 2013.

It’s A Great Time To Buy Or Refinance A Home

Improving labor data indicates that the economy is on the mend, but this could cause mortgage rates and home prices to rise as the economy expands.

A gradual economic recovery suggests that home buyers and others seeking lower mortgage rates and refinancing can still find favorable mortgage terms.

But it would likely be best to take advantage of the still historic home purchase and financing opportunities that are available today.

Contact your trusted, licensed real estate or mortgage professional today to learn how the growing economy can benefit your family as well.

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