March 29th, 2024 3:32 PM by T. Fanning
Happy Good Friday! I hope you have a great day and Easter!
This week was one of the most stable periods of mortgage rates in recent memory; volatility remained remarkably low. Overall, rates were very similar to last Friday's numbers. Next week could be a very different story. There are a large list of economic releases and other events scheduled that are expected to affect mortgage pricing. The week's calendar starts with the highly important Institute for Supply Management's (ISM) March manufacturing index and closes with the almighty monthly Employment report. Between those are a few moderately influential releases and another handful of Fed member speaking engagements. Two of those speeches stand out as potential market movers, both coming midweek.*
We offer Conventional, FHA, VA, USDA, Jumbo and regular construction financing. Some of our niches include: Chenoa Fund loans (100% FHA financing); Conventional, FHA and VA 1x Close Construction-Perm; 1.50% Down FHA Advantage Program; CHFA Financing; HomeStyle renovation program; and a Jumbo, 5% down program. We can also do non-traditional programs! To see a detailed list of programs, visit our website: www.homeloanmortgageco.com/mortgageprograms
Last Updated: 3/29/24
The bond market is closed today for the Good Friday holiday, as are the stock markets. They will reopen for regular trading Monday morning. If lenders are posting new rates this morning, most likely will be using pricing from yesterday afternoon if they issued an intraday increase before the early close in the bond market. Lenders that did not revise rates a little higher late in the day should reflect those losses this morning.
Today did have a fairly significant economic report posted despite the markets being closed. February's Personal Income and Outlays report was released at 8:30 AM ET. It revealed a 0.3% rise in income and a 0.8% jump in spending. The income reading was a bit softer than forecasts, but spending was much higher than predicted. Both readings were expected to show an increase of 0.4%. The smaller rise in income means consumers had less money to spend than thought. However, the bad news is that they spent much more than thought. Accordingly, this portion of the report is mixed with a tilt to negative for mortgage rates.
The more important readings in the report were the Personal Consumption Expenditures (PCE) and core PCE indexes. These are what the Fed heavily relies on as an inflation gauge and uses them during their FOMC meetings to determine monetary policy. The overall PCE was expected to have risen 0.4% while the core reading rose 0.3%. Today's report showed both readings rose 0.3%, making them slightly favorable for rates. The year-over-year readings for both matched expectations.
Overall, today's report has favorable and bad news in it. The big jump in consumer spending is a point of concern because that category makes up over two-thirds of the U.S. economy. However, that news can be offset by the weaker than expected overall PCE reading. It certainly doesn't alter predictions for what the Fed may do with monetary policy (rate reduction). This report had the potential to alarm the markets or cause a bond rally, but it doesn't look like we will get either come Monday- at least not from this data.
Next week has a large list of economic releases and other events scheduled that are expected to affect mortgage pricing. The week's calendar starts with the highly important Institute for Supply Management's (ISM) March manufacturing index and closes with the almighty monthly Employment report. Between those are a few moderately influential releases and another handful of Fed member speaking engagements. Two of those speeches stand out as potential market movers, both coming midweek. 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.*
*https://www.homeloanmortgageco.com/DailyRateLockAdvisory
Company NMLS ID: 479289 | LO NMLS: 208694
CO License: 100008854
FL Company License: MBR4416 | FL License: LO89221
Regulated by the Colorado Division of Real Estate
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.