February PPI was lower than expected

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Published Date 3/13/2025

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 under a little pressure today. The MBS market worsened by -5 bps yesterday. This was not enough to increase mortgage rates or fees. The market experienced high volatility yesterday.

Today's Rate Forecast: Neutral

Inflation: Headline February Producer Price Index (PPI) was lower than expected, 0.0% versus estimates of 0.3%. However, much of that miss was due to the UPWARD revision in January from 0.4% to 0.6%. YOY, it was 3.2% versus estimates of 3.3%. Core (ex food and energy) PPI was -0.1% versus estimates of 0.3%. Again, the prior month's revision is the culprit with 0.3% versus 0.5%. YOY, it was up 3.4% versus estimates 3.5%.

Jobs: The Initial Weekly Jobless Claims moved lower to 220K versus estimates of 225K after one of the highest Challenger Job Cuts (last week), government job cuts, much of CA off line due to fires etc. Continuing Claims were 1.870M versus estimates of 1.900M.

Treasury Auction: We have the most important auction of the week today with our 30Y Treasury bond auction at 1 pm ET today.

Geopolitical: The House-passed bill to keep the Government funded was killed in the Senate which makes a looming Government shut-down more probable. Tariffs in the EU are heating up after a 50% tariff against Kentucky Bourbon triggered President Trump to hit back with 200% tariffs against French wine, champagne, liquors etc for France and other EU countries.

Today's Potential Rate Volatility: Neutral

This morning markets are under a little pressure. Volatility has started at moderate to low levels.

Bottom Line:

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.

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All 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.

Jeff Beck

President

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

Web: https://www.americanhomelendingusa.com/