Initial jobless claims better than expected

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Published Date 5/25/2017

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: Neutral

Mortgage backed securities (FNMA 3.50 MBS) gained +17 basis points (BPS) from Tuesday's close which caused fixed mortgage rates or fees to move slightly lower for the session.

Today's Rate Forecast: Neutral

Fed: Today, we get Lael Brainard and then late tonight James Bullard speaks.

Treasury Auction: Today, we have our 7-year note auction at 1:00 EDT.

Jobs: Initial Weekly Jobless Claims were lighter than expectations (234K vs est.of 238K). The more closely watched 4-week moving average fell to a jaw-dropping 235,250K. Continuing Claims were just a tad better than expectations (1.923M vs est. of 1.925M).

Oil: A mixed bag out of OPEC; they have said that they will extend their current "cuts" for 9 more months but will not increase the level of the production cuts.

International Trade: The trade in goods (not services) basically were in line with estimates (-$67.6B vs est. of -$64.7B.

Great Britain (number 5 economy): Their Q1 GDP YOY was revised from 2.1% down to 2.0%.

Spain (number 14 economy): Their Q1 GDP YOY matched expectations with a 3.0% growth rate. The Catalonia region continues to scream for independence and traders are watching that development very closely. Catalonia is seeking a referendum vote in the Fall but Spain appears to be wanting to block that vote.

Today's Potential Rate Volatility: Average

We are trading at the EXACT same level right now as Monday's open which means for the entire week; the net change in mortgage rates has been negligible. Look for a mild day today as we have another sideways day and remain in the same channel that we’ve seen all week.

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.

Source: TBWS

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.

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