Good Day For Mortgage Rates 4-11-2018

By James Brooks

The bond market is up 6/32 (2.77%), which improve Raleigh Area mortgage rates by approximately .125 of a discount point.

This morning?s sole relevant economic report gave us a measurement of inflationary pressures at the consumer level of the economy. March?s Consumer Price Index (CPI) release showed that the overall reading fell 0.1% when it was expected to rise by the same amount. That is the good news in the releases. The more important core data that excludes volatile food and energy prices rose 0.2%, pegging forecasts. The weaker overall reading allows us to consider the data slightly positive for mortgage rates, but the truth is that the core data not showing a surprise has limited its impact on today?s pricing.

We have two afternoon events taking place today that have the potential to affect mortgage rates. The first is today?s 10-year Treasury Note auction results that will be posted at 1:00 PM ET. If investor demand for the securities was strong, the bond market could rally during afternoon trading, leading to lower mortgage rates. If the sales were met with a poor level of interest, the afternoon weakness may cause upward revisions to mortgage pricing early afternoon.

The final event of the day will be the release of the minutes from the last FOMC meeting. Market participants will be looking at them closely as they give us insight to the Fed's current thought process and individual Fed member opinions. Any surprises in the 2:00 PM ET release, particularly about inflation, economic conditions or when the next rate hike will take place, could cause afternoon volatility in the markets tomorrow and possible changes in mortgage pricing.

Tomorrow doesn?t have too much to be concerned with. We will get weekly unemployment figures and have the 30-year Bond auction to watch. Analysts are expecting to see that 230,000 new claims for unemployment benefits were filed last week, down from the previous week. Because rising claims is a sign of employment sector weakness, the higher the number of initial filings, the better the news it is for mortgage pricing. However, since this is only a weekly snapshot, it usually takes a wide variance from forecasts to directly impact 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.

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