FHA mortgage Rates (Nov 14)

Daily FHA Mortgage Rates Recommendation: If I were closing on an FHA Home Loan anytime within the next 7 days I would lock in my FHA Mortgage rate.
Friday’s bond market has opened in positive territory following the release of weaker than expected economic news. The stock markets are posting sizable losses after yesterday’s late rally in stocks hurt bond prices and mortgage rates.  The Dow is currently down 260 points while the Nasdaq has lost 60 points.  The bond market is currently up 22/32, but due to yesterday’s late losses we likely will not see much of an improvement in this morning’s mortgage rates.

October’s Retail Sales report was posted this morning, showing a surprising drop in sales of 2.8%.  This was a larger decline than was expected, the fourth consecutive monthly drop and the largest monthly decline since January 1987.  This indicates that the economy is still softening, which is good news for the bond market and mortgage rates.

The second report of the day was the preliminary reading to the University of Michigan’s Index of Consumer Sentiment for this month. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It revealed a reading of 57.9 that was a little stronger than expected, but not enough to negatively affect bond trading.

Next week is moderately busy with economic reports but it does bring us the release of two key inflation readings that can significantly impact bond prices and mortgage rates.  The week kicks off Monday with the release of October’s Industrial Production that tracks manufacturing output.  This report is considered to have a medium level of importance to the markets and is expected to show a small decline in output.

Besides the two inflation readings and Monday’s manufacturing report, we also will get the minutes from the last FOMC meeting and a couple of other lesser important releases.  Look for more details on next week’s events in Sunday’s weekly preview.

FHA Mortgage Rates (Nov 13)

Daily FHA Mortgage Rates Recommendation: If I were closing on an FHA Home Loan anytime within the next 20 days I would lock in my FHA Mortgage rate.

Thursday’s bond market has opened in negative territory, erasing part of yesterday’s late rally that came as a result of strong stock losses.  The stock markets have opened in negative ground, continuing yesterday’s selling.  The Dow is currently down 90 points while the Nasdaq has lost 27 points.  The bond market is currently down 4/32, but we will still likely see a small improvement in this morning’s FHA mortgage rates of approximately .125 of a discount point due to strength in bonds late yesterday.

This morning’s first piece of news was the release of September’s Goods and Services Trade Balance report. It gave us the size of the U.S. Trade Deficit, showing a $56.5 billion deficit.  That was a little smaller than forecasts of $57.0 billion, but this data is not considered to be of high importance to the markets and has had little impact on this morning’s trading or FHA mortgage pricing.

The other news released this morning was weekly unemployment figures from the Labor Department.  They reported that new claims for benefits jumped to 516,000 last week, exceeding forecasts of 479,000.  The previous week’s figures were revised to 484,000, meaning analysts were expecting to see a small decline in claims when we actually saw a sizable jump.  While this data is not considered to be of high importance because it tracks only a week’s worth of filings, it can influence trading and rates when it varies from forecasts such as today’s variance.

There are two reports scheduled for release tomorrow morning with one of them considered to be very important to the markets. October’s Retail Sales report is the first and the highly important one because it measures consumer spending. Since consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely. If this report reveals weaker than expected sales, the bond market should thrive and FHA mortgage rates will fall. Current forecasts are calling for a drop in sales of approximately 2.1%.

The second report comes late tomorrow morning when November’s preliminary reading of the University of Michigan’s Index of Consumer Sentiment will be released. This index measures consumer confidence, which gives us an indication of consumer willingness to spend. It is expected to show a reading of 57.0, down from October’s final reading of 57.6.

FHA Mortgage Rates (Nov. 12)

Daily FHA Mortgage Rates Recommendation: If I were closing on an FHA Home Loan anytime within the next 20 days I would float my FHA Mortgage Rate.

Wednesday’s bond market has opened in positive territory as investors shift funds from stocks into bonds.  This has pushed the stock indexes significantly lower again with the Dow down 312 points and the Nasdaq down 46 points.  The bond market is currently up 14/32, which should improve this morning’s FHA mortgage rates by approximately .125 – .250 of a discount point over Monday’s rates.  The bond market was closed yesterday in observance of the Veteran’s Day holiday.

There is no relevant data being released today, but we will get the results of today’s 10-year Treasury Note auction at 1:00 PM ET.  These results can influence bond trading enough to affect FHA mortgage rates this afternoon. If the sale was met with a strong demand from investors, bonds will likely rally and FHA mortgage rates should fall.

However, a lackluster interest could lead to weakness in bonds and higher FHA mortgage rates .

The first economic data of the week is September’s Goods and Services Trade Balance report Thursday morning. It helps us measure the size of the U.S. trade deficit, but usually is not a major influence on bond trading or mortgage pricing. It does affect the value of the U.S. dollar, which makes U.S. securities more attractive to international investors when the dollar is strong.

This is because the securities’ proceeds are worth more when sold and converted to the investor’s domestic currency. However, its results will not likely directly lead to changes in mortgage rates.

Overall, look for a fairly quiet week in the FHA mortgage market compared to previous weeks unless something totally unexpected transpires. The two Treasury auctions that are of the most interest are today’s and Thursday’s since they can impact mortgage rates the most. But there is only one important report being posted and that doesn’t come until Friday morning.

Daily FHA Mortgage Rates (Oct. 30)

Daily FHA Mortgage Rates Recommendation: If I were closing on an FHA Home Loan anytime within the next 60 days I would float my FHA Mortgage Rate.

Thursday’s bond market has opened in negative territory following the release of a stronger than expected GDP reading and early stock gains.  The Dow has risen 132 points while the Nasdaq has gained 30 points.  The bond market is currently down 17/32, which will likely push this morning’s FHA mortgage rates higher by approximately .375 of a discount point.

This morning’s big news was the preliminary reading of the 3rd Quarter Gross Domestic Product (GDP). The GDP is considered to be the benchmark measurement of economic growth because it is the sum of all goods and services produced in the U.S.  It revealed a decline of 0.3%, its worst reading in seven years.  It also was only the fifth time in 17 years that the quarterly GDP has fallen.  However, analysts were expecting to see a 0.5% decline, therefore, the numbers weren’t as bad as expected.  Also contributing to this morning’s losses was a key inflation reading in the data that showed a larger than expected increase.  This raised some inflation concerns and contributed to the weak opening in bonds.

The Labor Department posted weekly unemployment figures this morning, saying that 479,000 new claims were filed last week.  This was nearly unchanged from the previous week, but was slightly higher than forecasts.  However, there is no comparison between the importance of this data and the GDP.  With the GDP being considered a very highly important report, the markets ignored the weekly claims figures.

There are three reports scheduled for release tomorrow. The first is the 3rd Quarter Employment Cost Index (ECI), which tracks employer costs for salaries and benefits. Rapidly rising costs raises wage inflation concerns and may hurt bond prices. It is expected to show an increase in costs of 0.7%. A smaller than expected increase would be good news for bonds and FHA mortgage rates.

September’s Personal Income and Outlays report will also be posted early tomorrow. This data gives us an indication of consumer ability to spend and current spending habits. It is important to the markets because consumer spending makes up two-thirds of the U.S. economy. Rising income generally indicates that consumers have more money to spend, making economic growth more of a possibility.

This is bad news for the bond market and FHA mortgage rates because it raises inflation concerns, making long-term securities such as mortgage related bonds less attractive to investors. Analysts are expecting to see an increase of 0.1% in income and decline in outlays of 0.2%.

The week’s last report comes at 10:00 AM ET tomorrow when the University of Michigan updates their Index of Consumer Sentiment for this month. Current forecasts show this index remaining nearly unchanged from this month’s preliminary reading of 57.5. This index is important because it helps us measure consumer confidence, which is believed to indicate consumers’ willingness to spend. Since consumer spending makes up two-thirds of the U.S. economy, any related data is considered to be important.

Daily FHA Mortgage Rates (Oct. 27th)

Daily FHA Mortgage Rate recommendation | Monday’s bond market has opened fairly flat with the stock markets mixed and despite stronger than expected economic news.  The stock markets are in another volatile session after the international markets that had another significant sell-off.

If I were looking at FHA mortgage rates… I’d lock if my closing was taking place within the next 20 days.

The Dow is moving in a range of 250 points between its high and low of the morning, but currently stands up 30 points.  The Nasdaq is also fluctuating between positive and negative ground and is currently down 6 points.

The bond market is up 2/32, but we will likely see an increase in this morning’s FHA mortgage rates of approximately .125 – .250 of a discount point due to movements late Friday.

Today’s only economic data is the week’s least important.  September’s New Home Sales report was posted late this morning, showing an increase in sales of 2.7% when it was expected to reveal another decline.  However, offsetting that increase was a downward revision to August’s sales figures. Still, this data is not considered to be of high importance and has not influenced bond trading or FHA mortgage rates today.

Tomorrow morning brings us the release of the Consumer Confidence Index (CCI) for the month of October. This Conference Board index will be posted at 10:00 AM and gives us a measurement of consumer willingness to spend. It is expected to show a sizable decline in confidence from last month’s 59.8 reading, indicating that consumers are less likely to make large purchases in the near future.

As long as the reading doesn’t exceed the forecasted 52.0, we will likely see the bond market react favorably to this report. This data is watched closely because consumer spending makes up two-thirds of the U.S. economy.

The week’s FOMC meeting is a two-day meeting that begins tomorrow and adjourns Wednesday afternoon. Assuming the Fed stands pat and leaves FHA mortgage rates unchanged, traders will be looking at the post-meeting statement for any indication of the Fed’s next move.

Since there is a fair amount of uncertainty and a lack of a strong consensus of what the Fed will do here, the move itself, if it happens, will likely cause plenty of volatility in addition to the post-meeting statement.  The meeting will adjourn at 2:00 PM Wednesday, so look for quite a bit of volatility during afternoon hours.

Overall, it is difficult to peg a single day of the week as being the most important but I am expecting to see plenty of movement in rates this week. The data being posted tomorrow, Wednesday and Thursday is all very important to the markets.  The FOMC meeting is the single most important event of the week, but we may see noticeable movement in FHA mortgage rates several days this week.

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