Monday, July 28th
Monday’s bond market has opened in negative territory as traders await for this week’s slew of economic data. Stocks are starting the week with minor gains of 28 points in the Dow and 75 points in the Nasdaq. The bond market is currently down 4/32 (4.40%), but gains late Friday should keep this morning’s mortgage rates nearly unchanged. If you saw a small improvement Friday afternoon, you may see a slight increase this morning.
4/32
Bonds
30 yr - 4.40%
28
Dow
44,930
75
NASDAQ
21,183
Trailing 90 Days - National Average
Medium
Unknown
There is no relevant economic data set for release today, the only day of the week without at least one report for the markets to digest. We do have the first of this week’s two Treasury auctions that may affect rates taking place today though. 5-year Notes are being sold today, giving us an idea of investor demand for mid-term securities. Mortgage rates are based on longer-term debt, but this sale could have a slight impact on bond trading after results are announced at 1:00 PM ET. A strong demand for the securities could help boost the broader bond market during afternoon hours, possibly leading to a minor improvement in mortgage pricing. On the other hand, a weak interest from investors, particularly international buyers, may cause some pressure later today. This scenario will be repeated tomorrow when 7-year Notes are sold.
Medium
Unknown
The Conference Board will start this week’s heavy economic calendar with the release of their July Consumer Confidence Index (CCI) at 10:00 AM ET tomorrow. This index measures consumer sentiment, giving us an idea of consumer willingness to spend. A lower reading would mean consumers are less confident in their personal finances than last month and are less likely to make a large purchase in the immediate future. Current forecasts show a reading of 95.7 that would be an increase from June's 93.0. The lower the reading, the better the news for mortgage rates.
High
Unknown
The remainder of the week has plenty of highly influential reports and other events scheduled that are expected to cause noticeable volatility in the markets and potentially large moves in mortgage rates. In the coming days we will get reports such as the initial Gross Domestic Product (GDP) reading for the 2nd quarter, the Fed’s most relied upon inflation readings, a key manufacturing report and the almighty monthly governmental Employment report, along with several moderately important releases also. And let’s not forget about the FOMC meeting adjournment Wednesday afternoon.
High
Unknown
Overall, Wednesday is the most important day for rates due to the FOMC meeting, but Friday’s major ISM and Employment reports could bring a big move in rates that day also. There is little doubt that this week’s activities will cause a significant amount of movement in the financial markets and mortgage rates this week. Accordingly, please keep an eye on the markets 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... 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... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.