Our Real Estate Blog

Mortgage Rates (9/17/2010)

September 20th, 2010 9:40 AM by Lehel S.

Friday's bond market has opened in positive territory after this morning's economic data gave us favorable results. The stock markets are fairly calm during morning trading with the Dow up 5 points and the Nasdaq up 10 points. The bond market is currently up 6/32, which should improve this morning's mortgage rates by approximately .125 - .250 of a discount. 

The Labor Department said early this morning that August's Consumer Price Index (CPI) rose 0.3% last month, slightly exceeding forecasts. However, the more important core data reading was unchanged during the month, falling short of the 0.1% increase that was expected. This means that prices at the consumer level rose a little more than expected, but if more volatile food and energy prices are excluded, they rose less than many had thought. This is good news for the bond market and mortgage rates because the more relied upon reading indicates inflation was flat during the month, making long-term securi ties such as mortgage-related bonds more attractive to investors.

Also posted this morning was the University of Michigan Index of Consumer Sentiment. It showed a reading of 66.0, that was well below what analysts had expected. This means that surveyed consumers were less optimistic about their own financial situations than analysts had expected. This is also good news because waning confidence means consumers are apt to spend less, limiting fuel for economic growth.

Next week brings us the release of several relevant economic reports in addition to another FOMC meeting. There is nothing of importance scheduled for Monday, but Tuesday has some data and the Fed meeting. Look for 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... Float if my closing was taking place between 8 and 20 days... Float if my closing was tak ing place between 21 and 60 days... Float 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. 
Posted in:General
Posted by Lehel S. on September 20th, 2010 9:40 AM

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