Archive for March, 2010

Mar
29

Mortgage Market Trends for week ending March 26, 2010

Posted by: | Comments Comments Off

Last week saw mortgage rates again staying mostly flat with some mixed economic news. GDP for the last quarter of 2009 was revised downward to 5.6%, which was still a good improvement over previous quarters. Housing numbers were down again, giving some analysts concern about how housing will fair over the next few months, especially if rates start moving upward.

This week has some very important economic news for the markets to digest, including employment data, the ISM Manufacturing Index, and Consumer Confidence. With more signs that the recovery is slowing, every bit of data that reinforces that will help to hold mortgage rates from moving upward. However, the end of March is the end of the Fed’s program of buying mortgage backed securities. While this may pass as a non-event, it could also set mortgage rates on an upward trend that may last for some time. If equities continue to rally with good economic news this week, especially a drop in unemployment and a positive increase in jobs, we may see rates climbing in the near future.

Graph Courtesy from NY Times in an article by Bob Tedeschi March 24, 2010.  Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.

Comments Comments Off
Mar
23

Mortgage Market Trends for week ending March 19, 2010

Posted by: | Comments Comments Off

According to some analysts, mortgage rates again “wandered about aimlessly” last week. It is becoming more apparent that the current economic recovery will be a very slow and muted affair, at least for the time being. With manufacturing issues appearing to cool, consumers remaining on the sidelines, and, in last week’s PPI and CPI, inflationary pressures seeming to be nearly nonexistent. The Fed will likely be able to maintain its low rates for some time. The Fed’s policy statement last week said as much, with the Fed leaving rates unchanged again.

This week could be another week of the same for rates, but there are some unknowns coming. While many have pointed out that the Fed continues to base many tools available to influence rates, its campaign of buying mortgage-backed securities will come to an end on March 31st. While there appears to be some significant stability to rates right now, markets can turn quickly. Hopefully it will not happen, but even a false rumor could lead to a spike in mortgage rates in the coming weeks.

Graph Courtesy from NY Times in an article by Bob Tedeschi March 17, 2010.  Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.

Comments Comments Off
Mar
15

Mortgage Market Trends for week ending March 12, 2010

Posted by: | Comments Comments Off

Mortgage Chart

Last week saw mortgage rates again holding steady, as investors balanced economic news and the pending end to the Federal Reserve’s campaign of buying mortgage debt. Economic news was a bit light last week, and many appeared to be waiting for this week for insight into the economy and rates.

Markets will have plenty to digest this week, with many important economic reports and a quick, but critical, one-day meeting of the Fed. With such a muted reaction after the Fed raised its discount rate at its last meeting, some analysts are expecting the discount rate to go up again. However, expectations are for the Fed to hold its Fed Funds rate steady. As has been the case for some time now, the accompanying policy announcement will likely have greater influence. Every indication that the Fed believes we are returning to “normal,” will be that much more upward pressure on rates. This week also holds both the CPI and PPI. While inflation seems to be very muted with this slow economic recovery, the minute it starts picking up, mortgage rates should also start moving up.

Graph Courtesy from NY Times in an article by Bob Tedeschi March 10, 2010.  Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.

Comments Comments Off
Mar
02

Mortgage Market Trends for week ending February 26, 2010

Posted by: | Comments Comments Off

Much of the optimism about the pace or economic recovery evaporated last week, as economic news turned mostly sour. Consumer confidence plunged, and both new, and existing, home sales slowed considerably. While mortgage rates moved upward in last week’s Freddie Mac survey, they may begin trending downward if economic news this week continues to point to a stuttering recovery.

This week brings us the usual cascade of first-of-the-month data, with very important insight into manufacturing and employment. While GDP was adjusted upward last week, most of the increase was due to inventory-related adjustments. If the ISM Manufacturing Survey comes in below 55.0, w could see mortgage rates begin the week on a decidedly downward bent as traders begin worry about a manufacturing slowdown. However, if the ISM shows any improvement, rates will flatten, or perhaps even move slightly upward. Friday’s employment report will be hugely influential as usual. If we get an unexpected month of job creation we could see rates moving back upward next week.

Graph Courtesy from NY Times in an article by Bob Tedeschi February 24, 2010.  Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.

This Week’s Top Economic Reports and Events

Report/Event Date Prior Est. Impact
ISM Manufacturing Index 3/1 58.4 57.8 Significant
with manu
facturing leading this recovery, any big signs of slowing could help create some significant downward pressure on mortgage rates.
ISM Services Index
3/3 50.5 51.0 Moderate
If this index jumps unexpectedly higher, rates could f
eel some upward pressure, with services taking over some recovery from manufacturing.
Federal Reserve Beige Book
3/3 Moderate
The Beige Book paints a picture of the overall economy. If its tenor is slanted toward a stuttering reco
very, rates may feel downward pressure.
Unemployment Rate 3/5 9.7% 9.8% Significant
Af
ter last month’s surprise drop, a second surprise decrease might really surprise the market, and would put upward pressure on interest rates.
Non farm Payrolls
3/5 -20K -20k Significant
A return to job creation is the big boost the economy needs, but another month of
job losses will keep some downward pressure on rates.

Comments Comments Off