mortgage markets

Three Reasons Why Mortgage Rates Are Higher This Morning

July 5, 2007

Mortgage markets are making like last night’s fireworks, exploding in the sky with a bang. There are three main factors pushing rates higher today: Bank of England raised their interest rates by 0.25% and foreshadowed future increases European Central Bank Chairman Jean-Claude Trichet said that inflation is “likely to rise again significantly towards the end […]

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The Fed Starts Its Two-Day Meeting

June 27, 2007

The mortgage markets officially enter “Wait-and-See” mode beginning today as the Federal Open Market Committee begins their two-day meeting. The importance of the FOMC’s meeting to mortgage markets is all in the words of the committee as opposed to their actions (or lack thereof). After all, the group has not “done anything” in a year […]

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The Week In Review (June 25, 2007) : What To Watch For

June 25, 2007

For the first week in a long while, mortgage rates ended the week better than how they started. As we talked about last week, when there are no major data releases, the markets tend to move on momentum and psychology.  That’s precisely what pushed mortgage rates lower over the past five days. This week, though, […]

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The Five Words Spoken By Ben Bernanke That Rattled Mortgage Markets

June 6, 2007

Behold the power of the English language. With just five words, Federal Reserve Chairman Ben Bernanke rattled markets yesterday. In discussing how housing has slumped (and may continue to slump), Bernanke cited that weakness in the sector should not hold the rest of the economy back. This is departure from earlier this year.  In Q1, […]

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The Week In Review (June 4, 2007) : What To Watch For

June 4, 2007

Another week, another vicious rise in mortgage rates.  There just wasn’t enough “bad” news to reverse the market’s recent trend to the upside. There were three notable pieces of news from last week: The Fed’s May meeting minutes revealed a genuine concern that inflation is not slowing as anticipated The employment report showed that employers […]

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How Lenders Protect Against Losses When Mortgage Markets Deteriorate

May 23, 2007

The graph at right shows the path of mortgage rates in May.  The rate run-up continued yesterday. After a fairly tame start, yesterday’s action rapidly slipped away from mortgage rate shoppers beginning at 12:00 P.M. ET. Many lenders responded by invoking their right to a mid-day reprice as well, with some adding as much as 0.25% […]

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The Week In Review (May 14, 2007) : What To Watch For

May 14, 2007

Last week in the mortgage markets was thick with hype and thin with action. Whenever the Fed meets, there is potential for wild swings in mortgage rates.  And, although the Fed doesn’t control mortgage rates, it’s views on inflation and the economy carry tremendous weight with traders, with economists, with banks, and with governments across […]

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Today Is FOMC Day : What Will They Do/Say?

May 9, 2007

The Federal Open Market Committee meets today and markets will be hanging on their every word. There is virtually no chance that the Fed will change the Fed Funds Rate from its current 5.250% level, so its the Fed’s press release that will get all of the attention. We’ll disect the message in tomorrow’s blog […]

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Jobs Report Is The 800 Pound Gorilla In The Room

May 1, 2007

There’s a palpable uneasiness in mortgage markets right now and Friday’s payroll report looms large. Remember: it’s not the actual data that matters — it’s how close the data is to its expected levels. All week, traders have been jockeying for position based on a projected 100,000 new jobs created and if the number is […]

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The Week In Review (April 30, 2007) : What To Watch For

April 30, 2007

Last week, a ranking Fed official delivered a “wait-and-see” speech on inflation and that roiled the mortgage markets plenty. After sitting in a tight range for Monday through Wednesday, rates exploded higher Thursday as markets abruptly changed their expectations of growth for the rest of 2007. Despite weak housing numbers, employment and consumer spending figures […]

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What’s All That Yellen About?

April 27, 2007

So much for market calm. The mortgage market tanked yesterday when, in response to conflicting data about growth and inflation, San Francisco Fed President Janet Yellen said “watchful waiting” is the Fed’s likely next step. This surprised markets because most expect the Fed to lower the Fed Funds Rate within the next few months. The […]

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The Week In Review (April 23, 2007) : What To Watch For

April 23, 2007

The economy showed signs of pushing forward last week, but major pressure on the average American consumer surfaced in the form of rising gas prices. Overall, it was a mixed bag for mortgage markets. The Consumer Price Index (CPI) jumped 0.6% last month.  This cost of living increase was much larger than expected and mostly […]

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Whichever Way The Winds Blows

April 18, 2007

Up and down.  Up and down.  Up and down. It’s been a veritable roller coaster over the past two weeks for mortgage rates, mostly because traders can’t find the answer to the most important question facing mortgage markets: Are in the midst of inflation, or not? Everytime we see strong data in one sector of […]

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Watch What I Do, Not What I Say I’ll Do

March 30, 2007

The University of Michigan Consumer Sentiment Survey slipped to 88.4 in March, down from February’s 91.3 and its lowest level in six months. Why should you care about the UofM survey?  In a nutshell, you shouldn’t.  But, you sort of have to. Here’s why: Consumer confidence is considered important by markets because hundreds of “real […]

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Upward Revisions Keeps Weak Job Data From Moving Rates

February 2, 2007

This morning’s Non-Farm Payrolls report showed that 111,000 new jobs were created in January, short of Wall Street’s 155,000 expectations.  The weaker-than-expected figure did not give mortgage markets a reason to rally, however, because December’s figures were revised higher by 39,000 and November’s by 42,000. Traders have shrugged off the data for three major reasons: […]

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The Housing Engine That Won’t Slow Down

January 18, 2007

Housing Starts handily beat economists’ expectations this morning and CPI showed strength, too, sustaining the market momentum that has trended mortgage rates higher over the last 30 days. The Federal Open Market Committee has repeatedly told us that it expects the economy to slow down in 2007, led by a weakening housing market.  And yet, […]

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Why PPI Exceeded Expectations And Nobody Minded

January 17, 2007

With all signs pointing towards economic growth, markets were not all surprised when today’s Producer Price Index registered higher than expected.  Mortgage markets are flat in response to the data. The impact of PPI is muted for three other major reasons, too: At 2.0%, the year-over-year increase in PPI is much lower than it has […]

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