No Change In Today's Mortgage Rate 12-11-2017

By James Brooks

The bond market is up 1/32 (2.39), which should keep Raleigh area mortgage rates unchanged.

Today has no relevant economic data for the markets to digest, but there is an afternoon event that may affect mortgage rates. That would be the first of this week?s two Treasury auctions that carry the potential to influence rates. 10-year Notes will be sold today while 30-year Bonds go tomorrow. Results of both auctions will be posted at 1:00 PM ET each day. If they are met with a strong demand from investors, particularly international buyers, we should see strength in the broader bond market and improvements to mortgage pricing during afternoon hours. On the other hand, a weak interest in the securities could lead to an upward revision to rates.

Besides the 30-year Bond auction, tomorrow also has an important economic release. November's Producer Price Index (PPI) will be posted at 8:30 AM ET tomorrow morning. It shows inflationary pressures at the producer level of the economy. There are two portions of the index that are used- the overall reading and the core data reading. The core data is the more important of the two because it excludes more volatile food and energy prices, giving a more stable reading for analysts to consider. If it reveals stronger than expected readings, indicating that inflationary pressures are rising, the bond market will probably react negatively. That would drive mortgage rates higher. If we see in-line or weaker than expected numbers, the bond market could respond by pushing mortgage rates slightly lower. Analysts are expecting a 0.4% increase in the overall index and a 0.2% rise in the core data.

Overall, Wednesday is the key day of the week due to the release of November?s Consumer Price Index (CPI) followed by the FOMC meeting adjournment, Fed economic projections and press conference. The calmest day could be Friday. This week is probably going to be another active week for the markets and mortgage pricing. Focus will be on the inflation-related data and the FOMC events. While the markets are expecting a Fed rate increase, what is still being debated is how many moves the Fed expects to make next year. I am expecting that portion of the FOMC adjournment to have the biggest influence on rates. It, along with the week?s important data, makes it prudent to maintain contact with your mortgage professional if still floating an interest rate and closing in the near future.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Float 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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