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.

FHA Mortgage Rates (Oct. 26th)

FHA Mortgage Rate Recommendation: This is only my opinion of what I would do if I were obtain an FHA Home Loan. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

If I were considering an FHA Home Loan I would lock if I were closing within the next 20 days.

This week is packed with economic releases and major events that will likely lead to a fair amount of volatility in the markets and mortgage pricing. There are seven reports scheduled for release along with another FOMC meeting.

The first of the week’s news comes late tomorrow morning with the release of September’s New Home Sales.  This data covers the remaining 15% of home sales that last week’s Existing Home Sales report tracked and is this week’s least important data.

It is expected to show a decline in sales, but regardless of its results I am not expecting it to have a significant impact on FHA mortgage rates tomorrow.

The first important data will be posted Tuesday morning with 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 Tuesday and adjourns Wednesday afternoon. Assuming the Fed stands pat and leaves 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. Wednesday morning, the Commerce Department will post Durable Goods Orders for September. This report gives us a measurement of manufacturing sector strength by tracking orders at U.S. factories for big-ticket items. Analysts are currently calling for a drop in new orders of approximately 1.0%. If we see a smaller than expected decline in orders, FHA mortgage rates will probably rise as bond prices fall.

A weaker than expected reading should be good news for the bond market and mortgage rates, but this data can be quite volatile from month to month and is difficult to forecast.

The next relevant data is the preliminary reading of the 3rd Quarter Gross Domestic Product (GDP) early Thursday morning. 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. and therefore is likely to have a major impact on the financial markets and mortgage pricing.

There are three versions of this report, each a month apart. Thursday’s release is the first and usually has the biggest impact on the markets. Current forecasts call for a decline of approximately 0.5% in the GDP. If this report does show a decline, I am expecting to see the bond market rally and mortgage rates to fall.

There are three reports scheduled for release Friday.  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 mortgage rates.

September’s Personal Income and Outlays report will also be posted early Friday. 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 Friday 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.

Overall, it is difficult to peg a single day of the week as being the most important. The data being posted Tuesday, 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 mortgage rates several days this week.  Accordingly, please maintain contact with your mortgage professional.

FHA Mortgage Rates (Oct. 17th)

I would lock my FHA Mortgage Rate if my closing was taking place within 7 days. 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.

Today’s bond market opened relatively flat compared to recent trading sessions despite favorable economic news. The stock markets are up slightly with the Dow up 11 points and the NASDAQ up 6 points. The bond market is currently up 4/32, which will likely keep this morning’s FHA mortgage rates steady.

There were two economic report posted this morning, with both of them giving us weaker than expected results. September’s Housing Starts came in at a 17-year low, further supporting the theory that the housing sector is far from a recovery. The 6.3% drop in new starts was a much larger decline than analysts had forecasted. This is good news for bonds, but since the data is not considered to be of high importance, it has had a minimal impact on mortgage rates.

The second report of the day and the last of the week was October’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment. It showed a reading of 57.5, which was well off from forecasts of a 65.0 reading. This means that consumers were much less optimistic about their own financial situations than many had thought. That is also good news for mortgage rates because waning confidence usually means consumers spend less, which in turn slows economic activity and eases inflation concerns.

Next week is very light in terms of economic releases scheduled to be posted. Monday does bring us one of the week’s few reports with the posting of September’s Leading Economic Indicators (LEI) that attempts to predict economic activity over the next three to six months. It is a moderately important report and may cause a slight change in mortgage rates.

Look for more details on next week’s events in Sunday’s weekly preview.

Fed Rate Cut

The Fed Rate Cut came this morning, lowering it by .5% down to 1.5% and also lowered it’s discount rate by the same to 1.75%. They say the the move was necessary because of the global financial crisis. At the time of this post US stock futures is turning around.

The Federal Reserve coordinated a global cut in interest rates in cooperation with the European Central Bank, the Bank of England, and a host of other central banks across the globe, finally giving the market the bottle of milk it’s clamored for the last two days.

Despite some of the most aggressive actions by central banks that anybody has witnessed since the Great Depression. The Fed here has done everything it can to attempt to re-flate the stalled credit markets, getting to the point where it agreed to buy unsecured debt, while giving corporations access to its borrowing windows.

The Fed rate cuts are just the latest in a series of groundbreaking moves by the world’s top central banks to try to breathe life into embattled financial markets.

Earlier in the week, the Fed took steps that could potentially make trillions of dollars available to banks and the nation’s leading businesses. That’s on top of the controversial $700 billion Wall Street bailout approved by Congress Friday. Earlier Wednesday, the Bank of England announced a bailout plan of that nation’s banks, as it said at least $350 billion will be made available to British banks.

Today’s fed rate cut was the eighth since September 2007 and the second outside of a regularly-scheduled meeting. But the Fed had left rates unchanged at its last three meetings ahead of this emergency cut. The Fed’s next monetary policy meeting is a two-day session that concludes on Oct. 29.

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