In this week’s Mortgage Market Update, we see rates moving ever so slightly and a fairly neutral forecast for rate movement throughout the rest of the week.
Rates Currently Trending: Neutral
According to the data from Sigma Research, mortgage rates are moving sideways to slightly worse today. The MBS market worsened by -13 bps last week. This may have been enough to worsen mortgage rates or fees. The market experienced moderate volatility last week.
This Week’s Forecast: Neutral
1.) Domestic Flavor: This week is another back loaded week, but we have some very heady economic reports that will hit. Of note is Thursday and Friday’s Inflationary data with PPI and CPI. CPI has been over 2% year-over-year the last couple of readings and this will be watched closely. Retail sales will be the biggest report.
2.) Fed: After last week’s seemingly hawkish FOMC policy and Friday’s jobs data, the bond market will play close attention to their collective commentary this week:
- 05/08 James Bullard, Loretta Mester
- 05/09 Eric Rosengren, Robert Kaplan
- 05/10 Eric Rosengren
- 05/11 William Dudley
- 05/12 Charles Evans, Patrick Harker
3.) Across the Pond: Now that the French Election is over, the markets are focusing on if President Macron can get a cabinet together and who will be the Prime Minister. Great Britain will have an important BofE meeting. They will be the first Central Bank to be able to make policy without being forced to be on hold pending the French election and the future of Europe.
WTI Oil prices will also need to be closely watched as they have been providing terrific support for our pricing and Russia/Saudi Arabia are doing their best to prop up pricing this week.
This Week’s Potential Volatility: Average
With the French election behind us, and with expected results, look for a pullback in the MBS market (higher rates). We’re not looking for anything too dramatic given the significant amount of support we have in the MBS market. As noted above, Thursday and Friday could be volatile days whereas the rest of the week, we’re likely to experience less volatility.
What’s the Bottom Line?
If you’re weighing the risks and benefits of locking in your interest rate or floating it, contact your mortgage professional to discuss your options. We’re a leading Texas mortgage company with years of experience, competitive rates and a dedication to personalized, one-on-one home financing service. Give us a call today at (972) 591-3097.