Mortgage Rates Have Some Movement On Today's News 9-12-2017

By James Brooks

The bond market is down 11/32 (2.17%), which should push Raleigh area mortgage rates slightly higher.

Today?s only relevant event is this afternoon?s 10-year Treasury Note auction results. If demand was strong, particularly from international investors, we should see mortgage rates improve during afternoon trading. However, weak levels of interest could lead to broader selling in the bond market that may push mortgage rates higher. Results will be posted at 1:00 PM ET, so any reaction will come during early afternoon trading.

Besides the 30-year Bond auction, tomorrow also brings us some important economic data. The Labor Department will post August's Producer Price Index (PPI)at 8:30 AM ET tomorrow. It will give us an indication of inflationary pressures at the producer level of the economy. There are two readings that analysts follow in this release. They are the overall index and the core data reading. The core data is the more important of the two since it excludes more volatile food and energy prices. Analysts are predicting a 0.3% increase in the overall reading a 0.2% rise in the core data. Stronger than expected readings could fuel inflation concerns in the bond market. That would be bad news for bonds and mortgage rates because inflation is the number one nemesis of the bond market as it erodes the value of a bond's future fixed interest payments. As inflation becomes more of a concern in the markets, bonds become less appealing to investors, leading to falling prices, rising yields and higher mortgage rates. Rising inflation also makes a Fed rate more likely to come sooner than later.

We have several more pieces of economic data scheduled for release this week that is likely to influence the financial and mortgage markets. Thursday and Friday each have an important report scheduled in addition to other releases.

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.

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