Current mortgage rates are moving sideways today. We got a Consumer Price Index reading that was underwhelming, signaling to investors that the Fed might not be reading to hike rates at an aggressive pace just yet. Our recommendation remains, however, for borrowers to lock in a rate sooner rather than later. Read on for more details.
Market Outlook 3.12.18 from Total Mortgage on Vimeo.
Where are mortgage rates going?
Mortgage rates hold steady after CPI
It’s another snowy morning here Connecticut. If there’s anything more fickle than mortgage rates, it’s the weather in New England. Anyway, the big economic event for the day was the Consumer Prices Index.
Financial market participants were let down by the average hourly earnings reading in the monthly jobs report for February last Friday, and therefore eagerly anticipating another inflation reading today.
In similar fashion, the CPI reading came in with a mere 0.2% rise from the previous month. Anyone looking for a breakout in inflation was sorely disappointed.
The resulting market reaction was what you would expect, stocks moving higher and Treasury yields moving lower. The yield on the 10-year Treasury note (which is the best market indicator of where mortgage rates are going), dropped down a few basis points right after the report was released.
However, we’ve seen the 10-year yield inch back up to where it started the day since then. Mortgage rates typically move in the same direction as the 10-year yield, so we’re seeing rates just about flat on the day.
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Rate/Float Recommendation
Lock now before rates move any higher
Mortgage rates have increased dramatically so far in 2018. The end doesn’t seem to be anywhere in sight, either, as many analysts are calling for the 30-year fixed rate to climb all the way up past 5% at some point this year.
Learn what you can do to get the best interest rate possible.
Given this expectation, the smart decision for most borrowers is going to be to lock in a rate as soon as possible. The longer you wait on a purchase or refinance, the more likely it is you’ll be paying more with a higher rate.
Today’s economic data:
NFIB Small Business Optimism Index
The NFIB Small Business Optimism Index hit a 107.6. That’s slightly higher than the 107.0 that analysts had expected. This is the second highest level in the history of the reading.
Consumer Price Index
Consumer Prices ticked up 0.2% from the previous month in February. That puts it up 2.2%, year over year. CPI less food and energy also rose 0.2%, month over month, bringing it to 1.8%, year over year.
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Notable events this week:
Monday:
- 10-Yr Note Auction
Tuesday:
- NFIB Small Business Optimism Index
- Consumer Price Index
Wednesday:
- PPI-FD
- Retail Sales
- Business Inventories
- EIA Petroleum Status Report
Thursday:
- Jobless Claims
- Philadelphia Fed
- Empire State Mfg Survey
- Import and Export Prices
- Housing Market Index
Friday:
- Housing Starts
- Industrial Production
- Consumer Sentiment
- JOLTS
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from Total Mortgage Blog http://ift.tt/2FBwoqc
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