Published Date 7/5/2018
TODAY’S MORTGAGE RATE SUMMARY
HOW RATES MOVE:
Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.
RATES CURRENTLY TRENDING: NEUTRAL
Mortgage rates are moving slightly lower so far today. The MBS market worsened by -3 bps yesterday. This wasn’t enough to worsen mortgage rates or fees. The rates experienced low volatility yesterday.
TODAY’S RATE FORECAST: NEUTRAL
Factory Orders: The May data was much better than expected gain of 0.4% vs est of 0.0%. Plus April was revised upward significantly from -0.8% to -0.4%.
Economic Optimism: The July IBD/TIPP survey showed that business optimism is very strong with a 56.4 vs est 54.2 reading.
Australia: The Reserve Bank of Australia kept their key interest rate at 1.5%.
Eurozone: PPI YOY was hotter than expected 3.0% vs est of 2.7%. Retail Sales were at 1.4% vs est of 1.5%.
TODAY’S POTENTIAL RATE VOLATILITY: LOW
Mortgage rates are likely to move sideways for today with low volatility. We have a shortened trading day today and markets are closed tomorrow.
If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.