Tag: Portland mortgage rates

Mortgage Rate Update April 14, 2016

Posted on by Evan in Rate Update, Swanson Home Loans Blog - Mortgage Rate Updates and More

We had switched to a locking bias on Monday and that has proven to be the right call.  Mortgage rates have worsened very mildly since Monday.  This statement will contradict what you’ll hear from the media over the next couple days.

The Freddie Mac Primary Market Survey, which is what major media outlets tune into, was released today and showed that rates dipped slightly from last week.  Freddie Mac’s survey lags the market.

Lenders voluntarily submit interest rate information Monday-Wednesday of every week and then Freddie Mac releases the results on Thursday.  The results today simply show that mortgage rates were lower this Monday-Wednesday as compared to last Monday-Wednesday.  Unless rates move lower Monday-Wednesday next week next Thursday’s report will confirm that rates have worsened slightly.

Looking at the markets, the Consumer Price Index (CPI) was released today by the Labor Department and it continues a trend of tepid inflationary pressure.  This is friendly news for mortgage rates as inflation is the nemesis of long-term interest rates.

In a separate report weekly jobless claims matched the lowest level in over 40 years.  This is a positive sign for the economy which tends to be bad news for mortgage rates but at this point rates have not reacted.

From a technical perspective the US 10yr treasury yield and mortgage-backed bonds are trading at important levels after worsening over the last 3 days.  I am cautiously optimistic that they will catch technical support and rates will return to the levels we had at the beginning of this week.  But we need to be cautious given that rates are very near all-time lows.

Current Outlook: floating bias

Mortgage Rate Update March 28, 2016

Posted on by Evan in Rate Update, Swanson Home Loans Blog - Mortgage Rate Updates and More

Welcome back if you were away for spring break!  Mortgage rates worsened slightly last week but remain very attractive.

US stocks ended last week slightly lower.  This follows five weeks of strong gains.  As I wrote about on Thursday (see HERE) I think the stock market looks vulnerable which could lead to lower mortgage rates.

Contributing to losses in the stock market last week were comments made by Fed officials.  Federal Reserve Bank of Atlanta President Dennis Lockhart said in a speech that a rate hike could take place as soon as the April meeting, which is scheduled for April 26th-27th.  In a separate speech Federal Reserve Bank of Richmond President Jeffrey Lacker said he was confident inflation would continue to increase to the Fed’s target of 2%.  Prior to these comments the markets had thought the next Fed hike would not be until later in 2016 if at all.  Fed Chairwoman Janet Yellen is scheduled to deliver a speech tomorrow so analysts will be listening closely to her comments for additional clues.

The economic calendar is jam packed with significant economic data this week.  The highlight will be Friday’s all-important jobs report.  The markets are expecting ~200,000 new jobs created for the month of March.  Another strong report would likely push rates higher and vice versa.

Earlier today the Fed’s favorite gauge of inflation was released.   The Core Personal Consumption Expenditures Price Index (Core PCE) was up 1.7% year-over-year which is unchanged from last month and still below the Fed’s target.

I am going to maintain a cautious floating bias.

Current Outlook: cautiously floating

Mortgage Rate Update March 3, 2016

Posted on by Evan in Rate Update, Swanson Home Loans Blog - Mortgage Rate Updates and More

Mortgage rates are unchanged for the week.  That may all change tomorrow with the release of the all-important jobs report.

If you remember back to last month the jobs report missed expectations coming in at only 158,000 new jobs created.  This month analysts expect the report to show 190,000 new jobs created.  If the actual figure comes in higher than expected mortgage rates are likely to worsen and vice versa.

It’s always difficult to predict the monthly jobs report but based on what I am seeing I think there is more risk in floating than there is in locking.  Why?

First, from a technical perspective momentum is working against us.  See the chart below.

03-03-US 10yr Mortgage Rates Portland Oregon

Second, recent domestic economic data has been relatively healthy.  Private Payroll company APD released its version of the monthly jobs report yesterday and it showed that 214,000 new jobs were created last month.  In a separate release, the Fed released a report which showed that consumer spending rose in much of the nation during the first part of the year.

Lastly, given that last month’s report was released well below expectations I believe that there is a greater likelihood that it will be subject to a revision higher which would put upward pressure on mortgage rates.

Current Outlook: locking