Month over month CPI is double expectations

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Published Date 9/13/2022

Today'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

Mortgage rates are moving higher today. The MBS market worsened by -8 bps yesterday. This was not enough to increase mortgage rates or fees. The market experienced moderate volatility yesterday.

Today's Rate Forecast: Higher

Inflation: August Core (ex food and energy) CPI was DOUBLE the market expectations on a MOM basis (0.6% vs. est. of 0.3%). And on a YOY basis, increased from 5.9% in July to 6.3% in August which beat out expectations of 6.1%. Headline CPI was also stronger than expected, +0.1% vs. est. of -0.1% on MOM basis. THIS MARKS THE 27TH STRAIGHT MONTH OF RISING INFLATION and 8.3% vs. est. of 8.1% on a YOY basis. The Food Index jumped by 11.4% which is the largest 12 month increase since May of 1979.

Treasury Sales: We have a very important 30 year bond auction at 1 pm today.

Today's Potential Rate Volatility: High

This morning markets are under heavy pressure due to CPI. Volatility has started very high as the markets are very turbulent as markets try to find a new baseline.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

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All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

Atiba Thompson

President

NMLS: 376247

470 OLDE WORTHINGTON RD, WESTERVILLE, OH 43082

470 OLDE WORTHINGTON RD,, WESTERVILLE OH 43082

Company NMLS: 796590

Office: 614-578-1623

Email: atiba@orefc.com

Web: http://www.orefc.com