Published Date 2/27/2018
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 higher so far today. The MBS market improved by +6 bps yesterday. This wasn't enough to improve mortgage rates or fees. The rates experienced moderate volatility yesterday.
Durable Goods Orders: The January reading was weaker than expected across the board with the headline reading dropping -3.7% vs an estimated drop of -2.0%. When you strip out the volatile transportation sector, it dropped by -0.2% vs an expected increase of +0.5%. This report was seen some very wild swings and is largely discounted by traders compared to the impact that this report once had.
Housing: The December 20 metro city Case-Shiller Index showed a YOY home price gain of 6.3% which is just off of November's pace of 6.4%. The FHFA December reading showed a YOY price gain of 6.5%.
Consumer Confidence: Feeling good in the neighborhood! The February reading hit 130.8 which was much higher than expectations of 126.4 and is the highest reading since 2000.
Fed. Fed Chair Jerome Powell just started his live testimony in the Semi-annual Monetary Policy hearing in front of the House Financial Services Committee.
At 8:30 AM ET, the market received his prepared remarks. Here are a few headlines:
Mortgages will be paying close attention to Fed chairman Powell's testimony today which could cause some rate volatility.
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.
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