Published Date 10/28/2024
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.
Mortgage rates are moving sideways today. The MBS market worsened by -66 bps last week. This was enough to increase mortgage rates or fees. The market experienced high volatility last week.
Three Things: These are the three areas that have the greatest ability to impact rates this week. 1) Jobs, 2) Inflation and 3) Grab Bag.
1) Jobs: We have a ton of wage and job related data all week culminating in Big Jobs Friday with the NFP, Unemployment Rate and Average Hourly Earnings. The Bond market will be very sensitive (but skeptical) of stronger than expected jobs data on Friday and will rally on weaker than expected data.
2) Inflation: We will get the Fed's key measure of inflation on Thursday with Core PCE. The weaker the number is, the better it will be for rates. However, if this is higher than expected, it will drive rates the wrong way.
3) Grab bag: We have an important interest rate decision out of the Bank of Japan, a first peek at the 3rd QTR GDP and Geopolitical.
This morning markets got a small boost on oil prices but are now back to sideways trading. Volatility has started at moderate levels but will increase later in the week.
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.
Source: TBWSAll information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.
American Home Lending USA, LLC - NMLS ID: 71983. To verify licensing, visit NMLS Consumer Access (www.nmlsconsumeraccess.org). Equal Housing Lender.
NMLS: 19488
American Home Lending USA, LLC
240 S Buchanan St, Edwardsville IL 62025
Company NMLS: 71983
Office: 618-310-0091
Cell: 618-806-2281
Email: jbeck@ahlusa1.com
NMLS: 19488
Cell: 618-806-2281
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