Rate markets on hold ahead of midterms

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Published Date 11/6/2018

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 sideways so far today.  The MBS market improved by +5 bps yesterday. This probably wasn't enough to improve mortgage rates or fees.   The rates experienced low volatility yesterday.

Today's Rate Forecast: Neutral

Jobs: The September Job Openings and Labor Turn Over Survey (JOLTS) once again came in above 7M unfilled positions, which is once again more unfilled jobs then there are people unemployed. The prior month, August was revised upward from 7.136M to a new record high of 7.293M.

Treasury Auction: Today we have our 10 year note at 1:00.

Germany: Markit PMI Services 54.7 vs est of 53.6.

Eurozone: PP YOY 4.5% vs est of 4.2%.

Australia: The Reserve Bank of Australia kept their key interest rate at 1.5%.

Today's Potential Rate Volatility: Average

Mortgage rates are once again moving sideways even after strong ISM Services numbers yesterday and robust jobs numbers today. Rate markets are essentially on hold until the outcome of the elections are revealed.

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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Thomas Werbeckes

Mortgage Advisor

NMLS: 1543335

Finance of America Mortgage

6900 S McCarran Blvd #2020, Reno NV

Company NMLS: 1071

Office: 775-332-6629

Cell: 775-742-9128

Email: twerbeckes@financeofamerica.com

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