Another Slight Move In Today's Mortgage Rates 3-16-2017
By James Brooks
The bond market is down 12/32 (2.54%), which should push today's mortgage rates higher by approximately .125 of a discount point.
This morning had two minor economic reports for the markets to digest at 8:30 AM ET. February's Housing Starts showed a larger than expected increase in new home
groundbreakings. The Commerce Department announced a 3.0% increase in housing starts last month. A sizable increase in single-family home starts pushed them to their highest
level since October 2007, indicating the new home portion of the housing sector is strengthening. That makes the data bad news for bonds and mortgage rates.
The second report of the morning was last week’s unemployment figures. They revealed that 241,000 new claims for unemployment benefits were filed last week. That was down
from the previous week’s 243,000 new filings but close to the 242,000 that was forecasted. The decline in new claims is technically bad news, however, this is only a weekly
report and the small variance wasn’t enough to affect today's bond trading or mortgage pricing.
Tomorrow has three moderately important economic reports scheduled for release. First is February's Industrial Production report at 9:15 AM ET. This report measures
manufacturing sector strength by tracking output at U.S. factories, mines and utilities. It is expected to show a 0.2% rise from January's level. A large decline would be
considered favorable news for bonds and mortgage rates because it would indicate manufacturing sector weakness. Broader economic growth would be more difficult if
manufacturing activity is slipping.
Next up is the University of Michigan's Index of Consumer Sentiment for March just before 10:00 AM ET. This index gives us a measurement of consumer willingness to spend. If
consumers are more confident in their own financial and employment situations, then they are more apt to make large purchases in the near future. This helps fuel consumer
spending levels and economic growth. A drop in confidence will probably hurt the stock markets and boost bond prices, leading to lower mortgage rates. Bad news for bonds and
mortgage rates would be rapidly rising confidence. It is expected to show a reading of 96.8, up from February's final reading of 96.3.
The final report of the week will be Leading Economic Indicators (LEI) for February from the Conference Board. This index attempts to measure economic activity over the next
three to six months. It is considered to be moderately important, but likely will not have a significant impact on mortgage rates. Current forecasts are calling for a 0.5%
increase, meaning it is predicting that economic activity will likely expand moderately in the coming months. A smaller than forecasted rise, or better yet a decline would be
considered good news for the bond market and mortgage rates.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20
days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now.