Fed Acts, Mortgage Markets React
November 4, 2010 by Dan Hartman · 3 Comments
The long-awaited Federal Reserve Open Markets Committee meeting concluded yesterday, and the worst-kept secret in financial markets was revealed. The Fed views the economy as growing insufficiently quickly to correct its biggest problem – unemployment. It’s action? Over the next 9 months, the Fed has committed to purchase $600 billion in medium term Treasury securities.
Jobless Claims Down, Retail Sales Up, so Why Are Rates Improving? – Daily Mortgage Rate Update for October 7th, 2010
October 7, 2010 by Dan Hartman · 1 Comment
I’m going a little out on a limb, but I believe that we will never again see a better day to lock a rate than today. While there will be opportunities to lock close to today’s pricing, and while getting to a shorter lock period will bring gains, I feel locking today is a very good idea.
GDP Growth Revised Slightly Higher, Unemployment Claims Edge Lower – Daily Mortgage Rate Update for September 30th, 2010
September 30, 2010 by Dan Hartman · 1 Comment
At last week’s Fed meeting, the Open Markets Committee announced its intention to provide more support to the economy through a channel widely referred to as “quantitative easing” if it felt that necessary. Late last week, and earlier this week, there has been substantial market chatter about this probability. Yesterday, though, the presidents of the Federal Reserve Banks of Philadelphia and Boston spoke, and their words left substantially more unclear the criteria under which the Fed might actually act.
Durables Orders Up, Unemployment Claims Down, Markets React – Daily Mortgage Rate Update for September 24th
September 24, 2010 by Dan Hartman · 1 Comment
The Commerce Department reported this morning that overall orders for durable goods fell 1.3% in August, however, net of more volatile goods like aircraft, orders actually increased 2.0%. Durables are normally reported with and without transportation equipment because of the high price of that equipment and the somewhat sporadic nature of orders for it. July’s transport orders were particularly noteworthy due to the success of Boeing’s efforts at England’s biennial Farnborough Airshow. Durable goods orders are seen as a barometer of future business activity and economic growth. The news was seen as a strong positive for the US economy.
Unemployment Claims Continue Decline Streak; Wholesale Inflation Muted, Except Energy – Daily Mortgage Rate Update for September 16th, 2010
September 16, 2010 by Dan Hartman · 1 Comment
Workers filing for first-time unemployment benefits declined again last week to 450,000 from a revised 453,000 in the prior week, in yet another sign that the employment situation may be approaching a turnaround. Weekly claims have decreased each of the last four weeks, yet remain at 450,000, a level not seen as consistent with employment growth. There are already signs this morning that more claims may be one the way – one of the top headlines of the day is package deliverer FedEx’s plan to cut 1700 jobs in a consolidation of its trucking business.
Dip in Unemployment Claims Could Lead to Rising Rates, Maybe – Daily Mortgage Rate Update for September 9th, 2010
September 9, 2010 by Dan Hartman · Leave a Comment
Much of the chatter is that this represents a solid reversal of recent trends towards higher claims figures, but I feel this is more reflective of the manic-depressive nature of Wall St. That is to say, regardless of the type of information received, or of the significance of that information, it is either fantastically good or devastatingly bad, with no in-between. Yes, today’s dip in jobless claims is a positive sign, but it’s the first report below 470,000 in since July 29th. Is a single positive-trending report enough that we should dance around in euphoria?
Bouncing off the Ceiling – The Conflict Between Poor Economic Data and Record-Low Rates
September 2, 2010 by Dan Hartman · 2 Comments
The bottom line is, rates aren’t improving this week, not because economic data doesn’t support it, but because they can’t. When a 7-10 year investment yields between 2.5-4%, many investors will question the point of making such an investment, and will often look to other-higher yielding options. Corporate bonds may be quite attractive right now due to their higher yields and the strong profit figures many corporations are returning. Mortgage and Treasury rates are so low that only continued poor economic results can keep them there.
Jobless Claims Dip, But How Low is Too Low a Rate? – Daily Mortgage Rate Update for August 26th, 2010
August 26, 2010 by Dan Hartman · 1 Comment
Today’s employment data is significant, as it highlights the job market that will come under intense focus next week. Remember that the first Friday of each month brings the monthly employment situation report from the Bureau of Labor Statistics, commonly known as the jobs report. Next week’s report should be even more influential than others recently, as it will be free of distortion that has been caused by the recent hiring and subsequent layoff of almost 500,000 temporary census workers.
Unemployment Claims Rise, Mortgage Rates Fall – Daily Mortgage Rate Update for August 12th, 2010
August 12, 2010 by Dan Hartman · 1 Comment
The 30-year fixed mortgage hit another new low today, according to mortgage consolidator Freddie Mac. The average offered rate hit 4.44%, down from last week’s then-record 4.49%. Mortgage rates have continued to improve this summer as investors fear further declines in the economy due to weak employment and corporate leadership skittish about investment in new equipment. The Federal Reserve’s action Tuesday has further fueled improvement in rates. At this time, even homeowners with rates as low as 5.5%, and some even lower, can benefit from refinancing.
Unexpected Rise in Unemployment Claims Leads 30-Year Fixed to new record low at 4.49% – Daily Mortgage Rate Update for August 5th, 2010
August 5, 2010 by Dan Hartman · Leave a Comment
As I see it, there are two possible options that can come out of tomorrow’s jobs report. At present, a number of factors are keeping mortgage rates in a tight box with few places to go. The 10-year treasury, which is a substantial corollary to 30-year fixed rates, has been stuck in a range between 2.88% and 3.05% for over 3 weeks now, and has tried, and failed, to break below 2.88% in that time. This is lending substantial stability to mortgage pricing, as lenders have been able to offer almost the same rate throughout that time.
