Archive | March 2016

Another good day for Rates!!

MBS are up +4/32 (FNMA 30-yr 3.0 at 101.31), around 24/32 higher than yesterday at this time. Favorable repricing took place yesterday.

The rally following yesterday’s Fed announcement has continued this morning, although MBS prices have given back some of their early gains due to stronger than expected data. The Philly Fed regional manufacturing index jumped to 12.4, well above the consensus of -1.5. Weekly Jobless Claims rose to 265K, below the consensus of 270K. The Dow is down 10 points. JOLTS will be released at 10:00 et.

FED ALERT !!

Why my clients choose me?   I have my thumb on the pulse on whats going on in the market.  This FED NEWS is saving my clients THOUSANDS Versus the uniformed Loan Officers out there who Locked in their clients rate earlier today because they are not informed.

MBS are up +13/32 (FNMA 30-yr 3.0 at 101.25), around 17/32 above morning levels, and near the high for the day. Favorable repricing took place. Higher than expected CPI inflation data caused a small decline in MBS this morning. However, a dovish Fed statement (see below) caused a large rally in MBS this afternoon. The Dow is up 75 points. Tomorrow, Jobless Claims, Philly Fed, and JOLTS will be released.

As expected, the Fed did not change the federal funds rate. The statement contained guidance which reduced the expected number of rate hikes in 2016 from four to two. Reasons for this included a downgraded outlook for U.S. economic growth and inflation and concerns about the pace of global economic growth. The statement was good news for mortgage rates, as this guidance pushes tighter monetary policy farther into the future, including the expected timeline for the Fed to begin to reduce its large holdings of MBS and Treasuries. The added demand for MBS from the Fed helps to keep mortgage rates low.

FED NEWS TODAY 3/16/2016

MBS are down -4/32 (FNMA 30-yr 3.0 at 101.07), around 14/32 lower than yesterday at this time. Unfavorable repricing took place yesterday.

Stronger than expected CPI inflation data (see below) has hurt MBS this morning ahead of the Fed announcement this afternoon. The Dow is down 10 points. No more economic data will be released today. The Fed announcement will come out around 2:00 et, and Fed Chair Yellen’s press conference will begin around 2:30 et. No change in the federal funds rate is expected. In the past, comments from the Fed often have caused a reaction in MBS prices.

February CPI decreased 0.2% from January, above the consensus for an decline of 0.3%. CPI was 1.0% higher than a year ago. Core CPI, which excludes food and energy, rose 0.3%  from January, above the consensus for an increase of 0.2%. Core CPI was 2.3% higher than a year ago, up from an annual rate of 2.2% last month, and the highest level since May 2012. Separately, February industrial production fell 0.5% from January, weaker than the consensus for a decline of just 0.2%. February housing starts rose 5% from January to an annual rate of 1178K, above the consensus of 1150K, and the highest level since September. Starts on single-family homes rose to the highest level since November 2007. Building permits fell short of expectations.

TODAY’S NEWS!!

MBS are down -7/32 (FNMA 30-yr 3.0 at 101.12), around 9/32 below morning levels, and near the low for the day. Unfavorable repricing was seen. Despite weakness in the Retail Sales data, investors sold MBS ahead of tomorrow’s Fed meeting. The March NAHB Housing Index showed that home builder confidence was flat at 58, below the consensus of 59. The Dow is up 20 points. Tomorrow, the Fed announcement will come out around 2:00 et, and Fed Chair Yellen’s press conference will begin around 2:30 et. No change in the federal funds rate is expected, but the comments from the Fed could have a significant impact. In addition, CPI, Housing Starts, and Industrial Production will be released.

Market Update 3/14/2016

MBS are up +2/32 (FNMA 30-yr 3.0 at 101.16), around 2/32 lower than Friday at this time. Unfavorable repricing took placeFriday.

It has been a quiet morning. The Dow is down 50 points. No economic data will be released today. The next Fed meeting will take place on Wednesday.

TGIF 3/11/2016

MBS are up +1/32 (FNMA 30-yr 3.0 at 101.18), around 2/32 lower than yesterday at this time. First unfavorable and later some favorable repricing took place yesterday.

This morning, February Import Prices fell 0.3% from January, compared to the consensus for a decline of 0.8%. The Dow is up 175 points. No more economic data will be released today.

The monthly rollover took place overnight for FNMA and FHLMC 30-yr securities. The current coupon switched from the March to the April contract. If you are tracking daily MBS price movements, April MBS prices reflected a drop of about -7/32 from March. This change is priced in over the course of the month, so the impact on mortgage rates on the day of the rollover is generally no greater than on any other day of the month.

Market Update 3/10/2016

MBS are up +1/32 (FNMA 30-yr 3.0 at 101.27), around 4/32 lower than yesterday at this time. Unfavorable repricing took place yesterday.

It has been a volatile morning following the ECB announcement, but there has been little net effect on MBS prices. The European Central Bank (ECB) added to its stimulus program to help boost economic growth. Today’s actions included cutting all key interest rates and increasing the size of its asset purchase program to 80 billion euros each month from 60 billion previously. These steps were considered to be a little larger than expected, and global stock markets have rallied. For U.S. MBS, the added demand for bonds (positive for MBS) and the upward pressure on future inflation (negative) roughly offset each other. In the U.S., weekly Jobless Claims dropped to 259K, below the consensus of 275K. The Dow is up 100 points. No more economic data will be released today. The results from the 30-yr Treasury auction will come out around 1:00 et.

3/9/2016 Mortgage News

One big thing that just came out is the CFPB (Mortgage law makers) are overwhelmed with complaints about “online mortgage companies”  So if you plan on getting a mortgage I would highly suggest going about it the Old Fashion Way and working with a REAL PERSON who has “your best interest’ in mind.

MBS are down -4/32 (FNMA 30-yr 3.0 at 101.31), around 7/32 lower than yesterday at this time. Early investors may have priced at lower levels.

MBS prices have followed the movements in the stock market this morning. The Dow is up 50 points. No economic data will be released today. The results from the 10-yr Treasury auction will come out around 1:00 et.

Market Update 3/8/2016

MBS are up +9/32 (FNMA 30-yr 3.0 at 102.07), around 8/32 higher than yesterday at this time.

After posting losses over the past week, the trend for MBS turned this morning. One factor behind the rally this morning was weaker than expected export data in China, raising concerns about the pace of global economic growth. The Dow is down 100 points. No U.S. economic data will be released today. The results from the 3-yr Treasury auction will come out around 1:00 et.

BIG EMPLOYMENT REPORT= No Change

MBS are down -1/32 (FNMA 30-yr 3.0 at 102.05), around 1/32 higher than yesterday at this time. Favorable repricing took place yesterday.

Today’s mixed Employment report caused some volatility but had little net effect on MBS prices. Against a consensus forecast of 190K, the economy added 242K jobs in February. Upward revisions to prior months added another 30K. The Unemployment Rate remained at 4.9%, as expected. Average Hourly Earnings, a proxy for wage growth, declined 0.1% from January, well below the consensus for an increase of 0.2%. The weak wage data offset the strong job gains, making today’s report roughly neutral for MBS. The Dow is down 10 points. No more economic data will be released today.