March 1st, 2019 12:58 PM by T. Fanning
Last Updated: 3/1/19Friday's bond market has opened in negative territory, but not as much as it was before this morning's late economic news. Stocks are rallying with the Dow up 101 points and the Nasdaq up 27 points. The bond market is currently down 4/43 (2.73%). This may cause a slight increase in this morning's mortgage rates if comparing to Thursday's early pricing.The first of this morning's three economic releases was December's Personal Income and Outlays report. The Commerce Department announced a surprising 1.0% rise in income during December but a weaker than expected spending reading of down 0.5%. The jump in income indicates consumers had more money to spend at the end of the year but the weaker spending number shows they did not actually spend it. This data is relevant to mortgage rates because consumer spending makes up over two-thirds of the U.S. economy. With results being mixed, we can consider the data neutral for mortgage rates.Also part of this release was January's Personal Income data (no spending figures). It showed that income fell 0.1% in January, well short of the 0.3% increase that was forecasted. Since the results show consumers had less money to spend, we can consider this news slightly favorable for bonds and mortgage pricing. However, it did not have much of an influence on this morning's rates.The most important data of the morning was the Institute for Supply Management's (ISM) manufacturing index for February at 10:00 AM ET. They announced a reading of 54.2 for February, down from January's 56.6 and short of the 56.1 that was expected. This was also the lowest reading since November 2016. The softer reading means fewer surveyed manufacturing executives felt business improved last month than in January, which is a sign of a weakening manufacturing sector. Because the news points towards weaker economic conditions, this data is labeled good news for mortgage rates.Lastly, closing out the week's calendar was the University of Michigan's revision to their Index of Consumer Sentiment for February. It came in at 93.8, also weaker than forecasts and down from the preliminary estimate of 95.5. The decline in confidence should translate into softer levels of consumer spending that fuels economic growth.Next week brings us far fewer events that are likely to affect mortgage rates but does have the single most important monthly economic report scheduled. The week starts off Monday with nothing of importance set for release. Look for details on all of next week's activities in Sunday evening's weekly preview.If I were considering financing/refinancing a home, I would....Lock if my closing were taking place within 7 days...Lock if my closing were taking place between 8 and 20 days...Float if my closing were taking place between 21 and 60 days...Float if my closing were taking place over 60 days from now...This is only my opinion of what I would do if I was financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.**http://www.hlmcolorado.com/DailyRateAdvisory
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.