Mortgage Rate News 9-13-2017
By James Brooks
The bond market is down 2/32 (2.18%), but we should see little change in Raleigh area mortgage rates.
Yesterday?s 10-year Treasury Note auction didn?t go overly well. Some of the benchmarks we use to gauge investor demand showed a lackluster interest in the securities. The bond market made a small move after results were posted but it was not enough to affect mortgage rates. However, it doesn?t give us much to be optimistic about in today?s 30-year Bond sale. Results of today?s auction will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading.
Today?s sole economic report was August's Producer Price Index (PPI)at 8:30 AM ET that showed a 0.2% increase in the overall index and a 0.1% rise in the more important core data. Both readings fell 0.1% short of forecasts, meaning inflationary pressures at the producer level of the economy were a bit softer than expected. That is good news for bonds and mortgage rates because higher levels of inflation make bonds less appealing to investors and makes a Fed rate hike more likely to come sooner than later.
Tomorrow has two pieces of economic data that we will be watching, one of which is much more important than the other. The more important of them is August's Consumer Price Index (CPI) at 8:30 AM ET. The CPI is the more important of this week?s two inflation readings since it is considered to be a key indicator of inflation at the consumer level of the economy. As with today?s PPI, there are two readings in the report. Current forecasts show a 0.3% increase in the overall reading and a 0.2% rise in the core reading. The weaker the readings, the better the news it is for bonds and mortgage rates.
Also at 8:30 AM will be the release of last week?s unemployment figures. They are expected to show that new claims for unemployment benefits rose from 298,000 to 310,000. Good news for mortgage shoppers would be a sizable spike as rising claims is a sign of a weakening employment sector. Since this is only a weekly update, it often has little or no impact on mortgage rates unless it shows a sizable variance from forecasts. It is also worth noting that this data is expected to be skewed by storm-related filings, reducing the possibility of it affecting the financial or mortgage markets tomorrow.
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... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now.