Mortgage Rate Update July 20, 2015

Mortgage rates are mostly unchanged from Thursday.

With the Greek storyline in the rear-view mirror (for now) and a very light economic calendar this week I expect mortgage rates to respond to the stock market and technical trading patterns.

The US stock market is expected to respond to 2nd quarter earnings reports from various large companies scheduled for release this week (see earnings calendar HERE).  If earnings are reported stronger than expected one would expect capital to flow out of the bond market which would pressure mortgage rates higher (and vice versa).

From a technical perspective the yield on the US 10-year treasury yield, which mortgage rates generally follow, is trading right above the 25-day moving average at ~2.35%.  If the yield can dip below this level it would be a great sign for mortgage rates.  However, if they bounce higher we’ll need to shift to a locking bias.

Although the economic calendar is light this week there is significant housing news.  On Wednesday we’ll get existing home sales and the FHFA housing price index.  On Friday we get a reading of new home sales.

Current Outlook: floating