The Bank of England cut their key rate as was expected

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Published Date 11/7/2024

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: Lower

Mortgage rates are moving lower today. The MBS market worsened by -21 bps yesterday. This was not enough to increase mortgage rates or fees. The market experienced high volatility yesterday.

Today's Rate Forecast: Neutral

Jobs: Initial Weekly Jobless Claims matched expectations of 221K, Continuing Claims were higher than expected at 1.892M versus estimates of 1.880M.

Manufacturing: The preliminary 3rd QTR Non Farm Productivity was weaker than expected at 2.2% versus estimates of 2.3% and the Final 2nd QTR was revised downward from 2.5% to 2.1%. Unit Labor Costs were MUCH HIGHER than expected, shooting up 1.9% versus estimates of 0.5% plus the Final 2nd QTR was revised significantly upward from 0.4% to 2.4% which is massive.

The Fed: We will get the FOMC's Interest Rate Decision and Policy Statement at 2 pm ET today followed by a live presser with Fed Chair Powell. Market expectations are for a 25BPS cut.

Central Banks: The Bank of England cut their interest rate by 25BPS which was widely expected by an 8-1 vote.

Today's Potential Rate Volatility: High

This morning markets are improving. Volatility has started high and will stay that way.

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.

Source: TBWS

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.