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Mortgage Rates (6/13/2008)

June 13th, 2008 11:30 AM by Lehel Szucs

Friday's bond market has finally opened in positive territory despite early stock gains. The stock markets are in positive territory with the Dow up 122 points and the Nasdaq up 43 points. After a terrible week so far for bonds, the market appears ready to close the week on a positive note. The bond market is currently up 9/32, but we will still likely see an increase of approximately .250 of a discount point in this morning's rates as a result of significant selling in bonds late yesterday.

The Labor Department reported this morning that May's Consumer Price Index (CPI) rose 0.6% compared to forecasts of a 0.5% rise. However, the more stable and important core data reading that excludes volatile food and energy prices matched forecasts of a 0.2% increase. This means that food and fuel costs rose a little more than expected. This data was met with more of a relief than anything because there was some fear that fuel prices would be driving other costs at the consumer level higher.

In a further bit of good news, June's preliminary reading to the University of Michigan Index of Consumer Sentiment came in lower than expected. The 56.7 reading was nearly three percentage points lower than forecasts were calling for, meaning consumers were less optimistic about their own financial situation than many had thought. Generally speaking, this is good news for bonds because waning confidence usually means consumers are less apt to make a large purchase in the near future.

Next week is not too busy in terms of economic releases scheduled to be posted. There is no relevant news coming Monday, but Tuesday does bring us the release of the week's most important data. Look for more details on next week's events in Sunday's weekly preview.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Lock if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.


©Mortgage Commentary 2008

Posted in:General
Posted by Lehel Szucs on June 13th, 2008 11:30 AM

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