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THREE THINGS THAT CAN MOVE RATES THIS WEEK

THIS WEEK’S MORTGAGE RATE SUMMARY

HOW RATES MOVE:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.

RATES CURRENTLY TRENDING: HIGHER

Rates are trending slightly higher so far today.  Last week the MBS market improved by +7 bps.  This caused rates to move sideways on moderate volatility.

THIS WEEK’S RATE FORECAST: HIGHER

Three Things: These are the three areas with the greatest ability to move rates this week. 1) Jobs 2) The Fed and 3) Domestic

1) Jobs: We have a ton of jobs and wage-related data this week, with something hitting each day. Of course, Friday’s BLS data dump will get the most attention. The stronger the jobs data is, the worse it will be for rate markets.

2) The Fed: We get their Beige Book on Wednesday and a speech on Friday from Fed Chair Powell, but he is not supposed to be discussing rates or policy in his speech.

3) Domestic: We get some very weighty reports this week, with ISM Manufacturing and ISM Services getting the most attention. We also have Construction Spending and Factory Orders.

THIS WEEK’S POTENTIAL VOLATILITY: HIGH

We have a lot of economic data due out this week that can cause rate volatility. We’ll be paying very close attention to the jobs data through the week and particularly the BLS data on Friday.

BOTTOM LINE:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact Ken at Mortgage-Boss.com to discuss it with him.

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