Slight Increase In Mortgage Rates 4-3-2018
By James Brooks
The bond market is down 9/32 (2.76%), which should push Raleigh Area mortgage rates to increase by approximately .125 of a discount point.
There was nothing of importance posted this morning. Bonds improved some late Monday as stocks tumbled. This morning?s positive open in stocks is pressuring bonds, as we would expect to happen. If we see an intraday move in bonds and mortgage pricing today, it likely will be a result of a noticeable move in stocks. If they move downward again, we should see bonds improve and mortgage rates revise slightly lower before the end of the day. On the other hand, if stocks extend this morning?s early gains, we could see upward revisions to mortgage rates sometime before the close.
Tomorrow has two moderately important releases, beginning with March?s ADP Employment report at 8:15 AM ET. This report tracks changes in private-sector jobs, using ADP's payroll processing clients as a base. While it does draw attention, it is my opinion that it is overrated and is not a true reflection of the broader employment picture. It also is not accurate in predicting results of the monthly government report that usually follows a couple days later. Still, because we could see at least a moderate reaction to the results, we will be watching it. Analysts are currently expecting it to show that 190,000 new payrolls were added. The lower the number of jobs, the better the news it is for mortgage rates.
February's Factory Orders will be released at 10:00 AM ET tomorrow morning. This data is similar to the Durable Goods Orders report that was recently released, except it includes orders for both durable and non-durable goods. It will give us another measurement of manufacturing sector strength and is considered to be only moderately important to the bond and mortgage markets, so unless it varies greatly from forecasts of a 1.7% increase, I suspect that the data will have a minimal impact on tomorrow's 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.