Published Date 8/15/2022
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 improved by +1 bps last week. This was not enough to change mortgage rates or fees. The market experienced high volatility last week.
THIS WEEK’S RATE FORECAST: HIGHER
Three Things: These are the three areas that have the greatest ability to impact rates this week. 1) Retail Sales, 2) The Fed and 3) Manufacturing
1) Retail Sales: We get the July Retail Sales on Wednesday. This report is a “nominal” basis (total dollars spent) and is not adjusted for inflation. So as prices rise, it appears that Retail Sales are climbing, when in fact they are not. Retail Sales Ex-Autos are expected to decline by -0.1% but that would represent a huge move lower in actual total unit sales because prices are so much higher.
2) The Fed: We get a lot of Fed Speak this week as the market continues to try to hedge ahead of the September meeting.
08/15 Waller
08/17 Bowman, FOMC Minutes
08/18 George, Kashkari and their Balance Sheet
08/19 Barkin
3) Manufacturing: We get some important manufacturing news this week which will determine if we are in a manufacturing recession or not. Empire Manufacturing has already hit and it was the second worst reading on record. This week we will also get Industrial Production and Capacity Utilization, Philly Fed Manufacturing.
THIS WEEK’S POTENTIAL RATE VOLATILITY: HIGH
This morning markets are mostly treading water. Volatility has started at moderate levels but will likely spike on economic data later this week.
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
