| Market Comment
Mortgage bond prices finished the week near unchanged which kept rates flat. Rates were slightly higher the first portion of the week as stocks surged higher across the globe. Existing home sales printed at 5.69M versus the expected 5.57M units. Weekly jobless claims printed at 244K and continuing claims, a summation of all receiving benefits, at 2,060K. Analysts expected claims at 242K and continuing claims at 2,076K. Housing prices rose 0.4% in December according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI). Prices rose 1.5% in Q4/2016 and a whopping 6.2% year over year. New home sales were 555K. Consumer sentiment rose to 96.3. Mortgage interest rates finished the week near unchanged.
LOOKING AHEAD
Economic
Indicator |
Release
Date & Time |
Consensus
Estimate |
Analysis |
| Durable Goods Orders |
Monday, Feb. 27,
8:30 am, et |
Up 1.1% |
Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates. |
| Q4 GDP revised |
Tuesday, Feb. 28,
8:30 am, et |
Up 1.9% |
Very important. The aggregate measure of US economic production. Weakness may lead to lower rates. |
| Consumer Confidence |
Tuesday, Feb. 28,
10:00 am, et |
112 |
Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates. |
| Personal Income and Outlays |
Wednesday, March 1,
8:30 am, et |
Up 0.3%,
Up 0.2% |
Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates. |
| PCE Core Inflation |
Wednesday, March 1,
8:30 am, et |
Up 0.2% |
Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve. |
| ISM Index |
Wednesday, March 1,
10:00 am, et |
56.5 |
Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates. |
| Construction Spending |
Wednesday, March 1,
10:00 am, et |
Up 0.8% |
Low importance. An indication of economic strength. Significant weakness may lead to lower rates. |
| Fed “Beige Book” |
Wednesday, March 1,
2:00 pm, et |
None |
Important. This Fed report details current economic conditions across the US. Signs of weakness may lead to lower rates. |
| Weekly Jobless Claims |
Thursday, March 2,
8:30 am, et |
240K |
Important. An indication of employment. Higher claims may result in lower rates. |
Busy Week
Economic data is the number one reason mortgage interest rates move on a daily basis. Data is compiled from numerous sources and comes in two flavors, economic growth and inflation. Some releases are more important than others and thus are more likely to cause wider swings in mortgage rates. Rates move in relation to the deviation from expectations. We have significant releases almost each day of this week which is not common. The potential for mortgage interest rate volatility is greater as a result. Volatility can be the enemy as we saw the beginning of this year with negative movements (higher rates) after sentiment changed on looming Fed rate hikes. Any indication of strength in the data will likely result in higher mortgage interest rates so remain cautious.
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