Rate Lock Advisory

Monday, September 22th

Monday’s bond market has opened down slightly with little to drive trading this morning other than a Fed speech headline. Stocks are starting the week mixed with the Dow down 97 points and the Nasdaq up 9 points. The bond market is currently down 2/32 (4.13%), which should cause a mi or increase in this morning’s mortgage rates if compared to Friday’s early pricing.

2/32

Bonds

30 yr - 4.13%

97

Dow

46,218

9

NASDAQ

22,640

Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock

Medium

Negative

Fed Talk

There is no relevant economic data set for release today. Under the Fed Talk category, St. Louis Federal Reserve President Alberto Musalem said this morning that while he voted for last week’s rate cut, he is cautious about further cuts until inflation moves lower. He indicated he supported the quarter-point reduction to support the employment sector, but feels inflation is a bigger threat to the economy at this time. This could be the reason for this morning’s negative open in bonds as it reiterates inflation is still a threat to the economy (and the bond market).

Medium

Unknown

Fed Talk

There also are no relevant releases scheduled tomorrow either. However, there are two Fed speeches that markets will be focused on tomorrow. Vice Chair Bowman’s 9:00 AM ET appearance, followed by Chairman Powell’s speech at 12:35 PM. They both have topics that may draw a reaction in the markets.

Medium

Unknown

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

The remainder of the week has six monthly and quarterly economic reports that may affect mortgage rates, in addition to a couple of Treasury auctions and a lot more Fed-member speeches. The most important data comes late in the week, meaning we could see the biggest moves in rates the latter days, that is unless tomorrow’s Fed speeches yield a big surprise.

High

Unknown

Inflation News

Overall, Friday is the most important day of the week due to the importance the PCE inflation readings carry in the markets. No day stands out as a good candidate for calmest day since the Fed speeches may cause a reaction any day. The week’s calendar is fully by many standards, meaning it is safe to assume we will see movement in rates every day, with some moves being larger than others. If still floating an interest rate and closing in the near future, it would be prudent to keep an eye on the markets since they will likely be active.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock 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.

Greg Davis

Metrolink Mortgage

Loan Officer NMLS #238723 - Company NMLS #1469898
NMLS Consumer Access
6860 S. Yosemite Ct, Suite 2000 | Centennial, CO 80112

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