Rate Lock Advisory

Thursday, July 9th

Thursday’s bond market has opened in positive territory following no major surprises in this morning’s only relevant economic release. Stocks are mixed with the Dow down 95 points and the Nasdaq up 67 points. The bond market is currently up 8/32 (0.64%), which should improve this morning’s mortgage rates by approximately .125 - .250 of a discount point. If you saw an afternoon improvement in rates late yesterday, you may see little change in this morning’s pricing.



30 yr - 0.64%







Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock



Treasury Auctions (5,7,10,20,30 year securities)

Yesterday’s 10-year Treasury Note auction went very well with benchmarks showing a strong interest for the securities. Bonds improved shortly after results were posted at 1:00 PM ET, leading some lenders to make an intraday improvement to mortgage rates before closing. It also allows us to be optimistic about today’s 30-year Bond auction. If it also is well received, we may see strength in bonds and possibly another slight improvement to rates around 1:00 PM ET.



Weekly Unemployment Claims (every Thursday)

Today’s sole economic release was last week’s unemployment update at 8:30 AM ET. It revealed that 1.314 million new claims for unemployment benefits were filed last week, down from the previous week’s revised 1.413 million. Forecasts were calling for approximately 1.35 million, so the variance is minimal. The downward trend continues in new claims, but the number filed every week remains extremely high. Because rising claims is a sign of a weak employment sector, we can consider the data slightly positive for rates.



Producer Price Index (PPI)

May's Producer Price Index (PPI) will be released at 8:30 AM ET tomorrow. It measures inflationary pressures at the producer level of the economy. There are two readings to this index that analysts pay attention to. They are the overall reading and the more important core data that excludes volatile food and energy costs. A large increase would fuel concerns about inflation rising at the manufacturing level. This would not be good news for bond prices or mortgage rates since inflation erodes the value of a bond's future fixed interest payments. Rapidly rising inflation causes investors to sell bonds, driving bond prices lower, pushing their yields upward and bringing mortgage rates higher. Analysts are expecting to see a 0.4% increase in the overall reading and 0.1% rise in the core data. Good news for mortgage shoppers would be weaker readings.

Float / Lock Recommendation

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 taking 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.

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