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  1. Current Mortgage Rates for Tuesday, May 8, 2012

    1 By on May 8, 2012

    Remember all that talk about Greece and Europe and kicking-the-can-down-the-road policies from a couple of months ago?  Well we appear to have caught up to the can, and unsurprisingly, the problems that faced Europe are still pretty much the same as they were a couple of months ago.  The situation in Europe has the markets in sort of a tizzy, and stocks are selling off while Treasuries and mortgage backed securities are rallying.  Mortgage rates are slightly better this morning, and will likely be better on the day.

    I’m not a European policy expert, but the French and Greek elections over the weekend were pretty much an overwhelming rejection of the austerity measures that have at least partially caused much of the continent to fall back into a technical recession. All of this is going to have big repercussions for the future of the Eurozone, although guessing what will happen is kind of a fool’s errand.  To inject even more uncertainty into the situation, Spain announced this morning that bailouts are needed to stabilize its banks (although we all knew Spain would need a bailout months ago).

    There really aren’t any economic reports scheduled for today, so I suspect much of what happens will be a reaction to news and rumors out of Europe.  Generally speaking, this week is light on economic data, other than jobless claims on Thursday and the producer price index on Friday.  I expect that mortgage rates will continue to improve or sit near their current low levels throughout the week.

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  2. Current Mortgage Rates for Friday, May 4, 2012

    By on May 4, 2012

     

    So today is the day that we’ve been waiting for: nonfarm payroll day.  All week I’ve been saying that I anticipated a weak (but not atrocious) report.  This report is definitely weak, and almost bordering on atrocious.  However, we’re not seeing as large a market reaction as may be anticipated, because I think the expectation was at least partially baked into the market.  So far, mortgage rates have improved on the day.

    The payroll report said that we added only 115,000 jobs in April.  Unemployment fell to 8.1%, but that is simply the result of more people falling out of the labor force.  Labor force participation is at levels last seen in the early 1980s.  If you want to know why the economy is recovering so slowly, ponder this: there are about 315 million people in the United States, only 115 million are employed full time and another 27 million are employed part time.  This is not a recipe for a robust recovery.

    More and more signs are pointing to an overall economic slowdown.  It is going to be very interesting to see what the Fed reaction is.  The next Fed meeting occurs in June, after May’s employment report.  Another stinker like this one could prompt the Fed to act.  I don’t know if QE3 would actually be helpful in creating jobs, but it would almost certainly cause mortgage rates to dip further (the first two iterations don’t seem to have done much – although they may have prevented the situation from getting worse, it’s hard to say).

    Keep an eye on the elections in France and Greece this weekend, they could have a significant impact on the future of the Eurozone, which could cause a market reaction.  We shall see what happens.  Have a great weekend.

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    Category: Mortgage Rates

  3. Current Mortgage Rates for Thursday, May 3, 2012

    By on May 3, 2012

    Despite a positive jobs report this morning, we are not seeing much change in the markets so far this morning.  Mortgage rates have been range bound for most of the past couple of weeks, and I don’t think that will change today.  This whole week has really been a waiting game for tomorrow’s nonfarm payroll report.

    The positive jobs report that I was referring to was the Weekly Initial Unemployment claims report.  In the week ending April 28, the Department of Labor found that unemployment claims fell by 27k to a level of 365k (the prior week was revised upward to 392k).  Expectations were for a decline to 378k.  Despite being stronger than anticipated, the less-volatile 4-week moving average is still trending upward.  Normally I think we would see mortgage rates tick upward on a report like this, but recent data has been so mixed that I think the markets are sort of paralyzed, looking for a clear signal in one direction or the other.  Yesterday’s ADP data was poor, and I think we are going to see a weak report tomorrow, probably in the +120k to +150k range, less than expectations – although I think a somewhat negative report may already be baked into market pricing after ADP.

    The other economic data reported this morning was the Institute for Supply Management’s Non-manufacturing Index.  The report was worse than expectations, as the index fell from 56.0 to 53.5 in April (for this index, numbers over 50 indicate growth while numbers below indicate contraction).  Expectations were for a reading of 56.  This is just one more indicator that the economy slowed in April.

    News out of Europe now seems to be consistently negative.  Contentious Greek and French elections are scheduled for this weekend, and it is a distinct possibility that far right elements gain parliament seats in Greece, while the far right French nominee did well in a preliminary election.  You know things are bad if the Greeks (many of whom remember the bloody guerilla war against the Nazis in World War II) are considering electing fascists.  Unemployment in the Eurozone hit a fifteen year high this week.   Against that backdrop the European Central Bank is meeting today to discuss monetary policy.  Nobody seems to expect a shift in interest rates or the announcement of further easing, but I think it is a possibility they drop hints about one of both of these actions. This situation in Europe is clearly up in the air, and needs to be monitored as it could very easily impact our markets significantly.

    The rest of today is a waiting game for 8:30 tomorrow.  A surprise strong number could blow up our markets and cause rates to spike.  I think it is most likely that we see a weak number that causes a small rally, and it is possible that rates will test all-time lows.

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    Category: Mortgage Rates

  4. Current Mortgage Rates for Tuesday, May 1, 2012

    By on May 1, 2012

    Yesterday mortgage rates continued to linger close to record lows.  Today I anticipate that we will see more of the same, despite some positive manufacturing data (remember that mortgage rates tend to rise on positive news, and fall with negative news).  I believe that rates will continue to be range-bound until Friday’s employment report comes out.

    This morning’s key report was the Institute for Supply Management’s Manufacturing Index.  The report showed a reading of 54.8%, up from 53.4% in March.  Any number over 50% indicates that manufacturing is expanding, while numbers below 50% signify contraction.  This is the 33rd consecutive month in which manufacturing expanded.  The median expectation for the report was 53%. I did not anticipate a strong number from ISM after seeing weak numbers in the Chicago Purchasing Managers Index and the Dallas Fed Manufacturing Index yesterday.  Despite this strong report, recent economic data is decidedly mixed.

    There is scant news out of Europe today, which is kind of a nice change to be honest with you.  The whole continent is still going to hell in a handbasket, but at least we get a day off from hearing about it.  There are upcoming elections in Greece and France which could impact the future of the Eurozone and have implications for the overall global economy.  We shall see what happens.

    There’s not a whole lot else to say about today.  Tomorrow we have the ADP Employment Report and factory orders, and Thursday’s data will be weekly initial jobless claims and the ISM non-manufacturing index, but we will be stuck in a holding pattern until Friday’s employment report.  My guess is that we will see a fairly weak (but not atrocious) report, somewhere in the neighborhood of +120-150k.  I believe the expectation is for +162k.

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  5. Current Mortgage Rates for Monday, April 30, 2012

    1 By on April 30, 2012

    Last week mortgage rates were more or less range-bound, hovering close to, but not breaking through record lows.  Last week was marked by very mixed economic data as well as decidedly negative news out of Europe.  I expect that rates will continue to fluctuate around current levels throughout the week until Friday’s employment report.

    So far today we’ve seen mixed economic data again.  The Chicago Purchasing Managers Index fell sharply in April, going from 62.2 in March to 56.2 in April, significantly lower than expectations of  60.8 (numbers below 50 indicate contraction while readings above 50 indicate expansion).  Although manufacturing in the area is still growing, the growth appears to be slowing (as does the overall economy).  The Dallas Fed Manufacturing Index also showed slowing production in April. The index fell to -3.4 after a number of 10.8 in March.  This is decidedly below expectations.

    On the other hand, personal income rose by 0.4% in March, while personal consumption expenditures rose 0.3%.  These numbers are more or less in line with expectations, and indicate that inflation is more or less under control (which is important in figuring the odds the Fed will engage in further easing – inflation will put the kibosh on QE3).

    Once again, there is fairly dismal news out of Europe. Spain has re-entered a technical recession (two quarters of contraction), an austerity-induced outcome that surprises absolutely nobody. Unemployment is close to 25%, while youth unemployment is running north of 50%.  Although this situation bears some similarities to recent events in Greece, there is a distinct difference: Spain’s economy dwarfs that of Greece, and is far more important to the Eurozone as a whole.  In many ways Europe can limp along with the situation in Greece, the same cannot be said for Spain, and the current policy of kicking the can down the road won’t work nearly as well in Spain as it did in Greece (not that it worked well in Greece at all, but it delayed armageddon by at least a couple of months).

    Barring something totally unforseen, I anticipate that we will see mixed data throughout the week, and that the markets will fluctuate around current levels until Friday, when the non farm payroll report is released.  The last employment report was disappointing, which was concerning.  A second consecutive poor report could be interpreted as the start of a trend, and could increase the chances of further easing from the Fed (last week’s report which showed a slowing GDP also helps the odds of QE3).  The near-term future of mortgage rates is going to be determined on Friday.  I think we will see a weak (but not horrible) report, something in the neighborhood of +120-150 jobs.  I think that as it stands right now, I think the chances that the Fed takes further action in June are better than 50%.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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    Category: Mortgage Rates

  6. Current Mortgage Rates for Wednesday, April 25, 2012

    By on April 25, 2012

    Yesterday current mortgage rates rose a little bit as mortgage backed securities and Treasuries sold off.  Stocks rallied despite mixed economic data.  Right now we are seeing mortgage rates rise a little more, as stocks are rallying on the basis of some solid earnings reports (especially Apple), despite a pretty poor durable goods report.

    Durable goods orders posted the largest decline in three years in March, falling 4.2 percent from February.  This is not at all good for the manufacturing sector, and should give pause to those anticipating continued U.S. economic growth.  One data point does not a trend make, but we are beginning to see consistently softer economic numbers over the past month or two.

    This leads us to the big action for today, the Fed statements due out later today.  I don’t anticipate that we will see much change from anything the Fed has said for the past couple of months.  They will say that unemployment remains high, and that significant economic headwinds remain.  I imagine they will continue their commitment to keeping rates low for the foreseeable future, but that they may upwardly revise their inflation outlook for the remainder of the year.  I also believe that the odds for more quantitative easing remain around 50-50.

    If the Fed is going to engage in further easing, it almost certainly will not be announced today, but I think that it could be announced in June (if it is going to happen).  There is an unusually long break between this meeting and June’s meeting, and two employment reports will be issued during that time.  Last month’s report was weak, and two more weak reports could very well convince the Fed that they need to take further action.  Strong reports will likely dissuade them from further action.  I think it is going to be a wait-and-see type of deal.

    There is the potential for us to see rates jump if the Fed’s outlook is decidedly more upbeat and/or the odds of QE3 are seen as significantly diminished, although this is not a scenario I anticipate.  We may see rates increase somewhat today, but I think they will still remain close to record lows.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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  7. Current Mortgage Rates for Monday, April 23, 2012

    By on April 23, 2012

    Last week mortgage rates nearly cracked record levels, but ended more or less flat as a sell-off late in the week erased any gains.  This morning we are seeing an early rally in mortgage backed securities due to concerns over an apparently contracting Chinese economy and a still unsettled European debt problem.  It seems likely that mortgage rates will remain flat or improve somewhat today.

    There are no economic reports scheduled today, while tomorrow features the Case-Shiller Home Price Index, New Home Sales, Consumer Confidence, and the FHFA House Price Index.  The big news of the week is Wednesday’s Fed announcement.  I don’t anticipate that we will see any real change in the Fed’s outlook.  I think we are going to see the Fed suggest that labor conditions will improve a little bit, and possibly upwardly revise their inflation outlook a little, but I don’t think they will rule out further easing or deviate from their commitment to keep rates low in this meeting. If there is to be a major change to monetary policy, I think it will happen in June’s meeting.  There will be two employment reports between this week’s meeting and June, and those reports should give us a much better idea of the direction our economy is headed.

    As per usual, it is hard to get a hold on the situation in Europe.  The French are in the middle of an election and the Dutch government’s budget negotiations fell apart over the weekend.  The situation in Spain remains tenuous, as borrowing costs rise it appears that country is headed for a bailout.  The only statement I can make about Europe with any real certainty is that European lawmakers probably won’t take real, concrete action to solve any of the underlying problems in the region, and any “solution” will probably be temporary (see Greece, Ireland).

    So the first half of this week is a waiting game to see what the Fed does on Wednesday (I don’t expect they will do anything).  In the meantime, rates will remain low.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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  8. Current Mortgage Rates for Wednesday, April 18, 2012

    By on April 18, 2012

    Yesterday we saw mortgage rates increase a little bit at the stock market underwent the biggest rally of 2012.  Yesterday’s stock rally was at least partially a result of the IMF upwardly revising growth estimates for both the global economy and the U.S. economy.  It was probably also a result of people buying the dip after more than a week of sell-offs.

    Today almost no economic data will be released, and we are seeing stocks sell-off which is likely a result of some profit-taking after yesterday’s rally.  Mortgage backed security pricing has been up and down today, but I would guess that we are going to see rates remain the same of get a little bit better by the end of the day.

    On days when there is no economic data, the focus of the markets tends to wander back to the situation in Europe.  As has been the case for months, the problems in Europe are somewhere between dire and not a huge deal depending upon whose opinion you want to listen to.  It looks more and more likely that Spain will need a bailout, and the upcoming French election could be a game changer if the leftist candidate is elected.  Fears of European problems will probably weigh more heavily upon the markets today in the absence of other data.

    Tomorrow we will see jobless claims, existing home sales, the Philadelphia Fed Survey, and the results of numerous treasury auctions.  Bad auctions or firmer economic data has the potential to push rates higher.  For today, we will probably see rates linger near record lows.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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  9. Current Mortgage Rates for Tuesday, April 17, 2012

    By on April 17, 2012

    Yesterday saw some improvement in mortgage rates as continuing fear over debt problems in Europe drove mortgage backed securities higher.  Today it looks as through we are going to give back some of those gains as stocks rally on a higher growth outlook, although I don’t anticipate a large increase in rates today.

    This morning’s economic data was mixed.  First the good news: the IMF raised their global estimate of annual economic growth from 3.3% to 3.5% this morning.  Estimates of U.S. economic growth were revised upward from 1.8% to 2.1%.  This is the primary reason for this morning’s stock rally.

    The bad news is that housing starts were down in unexpectedly in March, falling 5.8% from February.  Industrial production was unchanged in March, which was more or less in line with expectations.  This stall follows several months of industrial growth.

    As usual, this occurs against the backdrop of ongoing economic strife in Europe.  It appears more and more likely that Spain and Italy will need to be bailed out, and the French election could potentially throw a monkeywrench into the Eurozone if the leftist candidate is elected.  This situation is constantly in flux and it is difficult to predict what the impact on mortgage rates will be.

    Even if we give back some of yesterday’s improvements, I suspect that mortgage rates will continue to sit around record lows today.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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    Category: Mortgage Rates

  10. Current Mortgage Rates for Monday, April 16, 2012

    By on April 16, 2012

    Last week we saw mortgage rates improve as fears of European debt contagion, worries over the U.S. job market, and a slowing Chinese economy outweighed marginally firmer U.S. economic data. This week I suspect that we will see rates sit near current levels as we await the following week’s Fed statements.

    Today’s economic data showed retail sales improved by 0.8% in March (+/-0.5%).  This is better than expectations, but I think that fears over a devolving situation in Europe will overshadow this somewhat positive number (mortgage rates tend to rise on bad news and fall on good news – given the report alone, we might expect rates to rise).  Make no mistakes about it, the problems in Europe are getting worse.  Spainish bond yields are rising, and it looks more and more likely that a bailout will be needed.  The cost of borrowing is also rising in Portugal.  Horrible austerity programs are wreaking havoc in Greece and Ireland.  Elections loom in France.  The whole situation is very uncertain, and the potential for Europe to drag the global economy down with it is very real.

    On the other hand, we are generally seeing stronger U.S. economic data of late (a bad payroll report two weeks ago is the major exception). There is some data this week, but the following week has durable goods, GDP, jobless claims, home sales, and the all-important FOMC announcements.  I don’t think that we will see more easing announced next week, but we should get some idea of the direction that the Federal Reserve is headed.  If the Fed improves its outlook and we get some firm U.S. data, we will likely see rates rise.  Soft data and a negative Fed will cause rates to fall.

    In any case, I think that the good and bad news will more or less balance each other out this week (barring any major developments in Europe), and we will see rates stay pretty close to record lows for the foreseeable future.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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    Category: Mortgage Rates

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