Published Date 6/9/2022

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 today. The MBS market worsened by -14 bps yesterday. This was not enough to increase mortgage rates or fees. The market experienced low volatility yesterday.

TODAY’S RATE FORECAST: NEUTRAL
Jobs: Initial Weekly Jobless Claims increased by 229K vs. est. of 210K. The more closely watched 4 week moving average moved upward to 215K. Continuing Claims were in line with estimates of 1.306M

Treasury Sales: We have an important 30 year Treasury bond auction today at 1 pm ET.

Central Banks: The European Central Bank kept their key interest rate at 0.0% and their deposit rate at 0.5%. However, for the first time since 2011, the ECB confirmed that their internal conditions have been met to start raising interest rates. They announced that they intend to raise their rate by 25BPS in July and by at least 25BPS in their September meeting. They may increase it by more than 25BPS in September if conditions warrant and thereafter they would be on a slow and gradual rate increase path. They announced that they would end one of their bond buying programs (APP) on July 1, but they will keep rolling over and buying bonds each month… they simply wont be increasing the size of their balance sheet (full of junk bonds)… they did not mention any discussion on QT. They also upwardly revised their economic projections on inflation to 6.8% in 2022 and then magically it will be forced all the way down to 3.5% in 2023 and then to 2.1% in 2024.

TODAY’S POTENTIAL RATE VOLATILITY: NEUTRAL
This morning markets are trending slightly towards higher rates. Volatility is at moderate levels and may spike higher later in the day.

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.

Not all borrowers qualify for all programs, must meet underwriting guidelines and are subject to credit review and approval. This does not constitute a commitment to lend. JC Financial Solutions, Inc is an Equal Housing Lender. NMLS 365033, CABRE 01445232