Markets under pressure ahead of FOMC

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Published Date 9/20/2022

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 -21 bps yesterday. This may have been enough to increase mortgage rates or fees. The market experienced high volatility yesterday.

Today's Rate Forecast: Higher

Housing: August Building Permits tanked to 1.517M units on an annualized basis vs. est. of 1.610M. However, Housing Starts rose to a 1.575M pace vs. est. of 1.445M. But All the gains in starts were driven by multi-family units, which soared 28.6% MoM from 483K in July to 621K, highest on record!

Treasury Sales: We have an important 20 year Treasury bond auction today at 1 pm ET.

Central Banks: After lowering their interest rate at their last meeting, the People's Bank of China kept their key interest rate unchanged at 3.65% at this meeting.

Today's Potential Rate Volatility: High

This morning markets continue to be under pressure. Volatility is high as FOMC starts and markets prepare for tomorrow's statements.

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.

Wymac Capital, Inc.

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