Financial market participants are optimistic about tax cuts and the next Fed chair and it’s creating a risk-on scenario which is putting upward pressure on Treasury yields and mortgage rates.
There’s still a lot of week left with many opportunities for rates to adjust so anyone looking to buy a home or refinance should keep an eye out for changes in the market. Read on for more details.
Market Outlook 10.23.17 from Total Mortgage on Vimeo.
Where are mortgage rates going?
Investor optimism pushing rates higher
It was somewhat of a slow start to the week yesterday with no significant economic data out. We did, however, see continued eagerness and optimism from the markets about tax reform and the next Fed chair.
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After the Senate pushed through a budget resolution bill last Thursday, it’s now up to the House to approve that budget this Thursday. Right now, it’s looking like it has a chance at passing, but it’s not entirely set in stone.
Regardless, the expectation that it will pass is bolstering investor optimism and allowing them to take on more risk. That translates to stocks over bonds, pushing Treasury yields higher. The yield on the 10-year Treasury note has moved up to 2.40%, which is its highest point since May.
Mortgage rates typically move in the same direction as the 10-year yield so we’re seeing some upward pressure in the beginning of the week. As stated, investors are also closely watching the situation surrounding the Federal Reserve.
With Janet Yellen’s term ending in February it’s up to President Trump to keep her around or find a new person for the job. There’s been a lot of chatter over the past week and a half about all of the potential candidates, and just yesterday Trump himself said that he is “very, very close” to a decision.
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While Trump hasn’t completely ruled out another term for Yellen, word has come out that he is being advised to go with either Stanford Professor John Taylor or Fed Governor Jerome Powell. A decision is expected to be made before Trump heads to Asia on November 3.
What does this mean for me?
Get a rate quote that means something
Mortgage rates are up a little from the start of the week but are still at very accommodating levels for anyone looking to purchase a home or refinance their current mortgage.
If you’ve been thinking about taking action it makes sense to get a custom rate quote that will let you know exactly where you stand. You can make this happen by calling one of our mortgage specialists or by taking a couple minutes to fill out our online form by following the link below.
Click here to head to our Mortgage Builder and figure out how much you could save.
Today’s economic data:
PMI Composite Flash
The PMI composite flash came in at 55.7 for October. Manufacturing came in at 54.5 and Services at 55.9. That’s an uptick from the previous readings and slightly better than what the consensus called for.
Notable events this week:
Monday:
- Nothing
Tuesday:
- PMI Composite Flash
Wednesday:
- Durable Goods Orders
- New Home Sales
- EIA Petroleum Status Report
Thursday:
- International Trade in Goods
- Jobless Claims
- European Central Bank Meeting
- Pending Home Sales Index
- Fedspeak
Friday:
- GDP
- Consumer Sentiment
from Total Mortgage Blog http://ift.tt/2le7J19
via Zero Mortgage Insurance
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