Mortgage Rates and What May Move Them This Week: April 12, 2010
Economic Calendar
Ahhhhhh... That was the Sigh of relief last week as we had the first positive gain in Fannies in a month. By the close of the day on Friday we saw the price of Fannies up 7/32nds over the week and that translates into a noticeable improvement on a rate sheet. It was a bumpy week, but when the dust settled it was all good at the end!the best day of the week was Wednesday which also happened to be one of the potentially scary days. The 10 yr auction went off well and there were no shockers to scare the market.
This week is quiet till mid week and then over 3 days we have quite the list of info for the markets to chew on. Here is this weeks economic calendar:
- Monday April 12: No news day in the markets. With the Absence of any data to chew on and the Dow up above 11,000 we still have a happy credit market with Fannies trading significantly higher. Today is a good day for rates (so far)
- Tuesday April 13: Another no news day... at least nothing significant... In the absence of data we will have to look to stocks. I have heard mumblings in the market that are projecting a bit of a sell off in stocks, this could be good news for rates, but it is hard to say what will happen yet.
- Wednesday April 14: March CPI expected +0.1% with a core rate of +0.1%. This is a fairly low number that clearly would show inflation under control, as reported it will likely keep rates steady.
- Wednesday: March Retail sales expected +1.2% ex auto +0.5%. While this is a strong number investors are likely to ignore it since most Easter Sales were made in March, leading investors to think that April will be weaker in the trade off.
- Wednesday: February Business inventories expected +0.4%. Any growth in business inventory shows that companies are confident in the economy moving forward. Good news is potentially bad news for rates, so it would be hard for rates to go down with a report like this.
- Wednesday: Fed Beige Book Released. This "book" reports the good the bad and the ugly of all 12 federal reserve districts. While there is signs of recovery in most areas, the weakness of jobs market is likely to overshadow the good news. It is not likely there are any surprises here and this is not likely to be a market mover.
- Thursday April 15: Get your taxes done yet? I finally did mine over the weekend!
- Thursday: Initial Jobless Claims expected down 20,000. This still puts the jobless rate at 440,000 well above a number that says things are wonderful in the jobs market.
- Thursday: March Industrial production expected +0.7% and Capacity 73.3%. This will make for 8 out of the past 9 months showing improvement production, but capacity is still low enough that it has no fear of inflation in the mix.
- FridayApril 16: march Housing starts expected +6.1% and Building permits -1.1%. While the starts number looks scary high, it really isn't since the weather was so bad in most of the country this winter that much of this is the back log that just got going as we thawed out.
- Monday April 19: March LEI expected +0.6%. Leading Economic indicators are one of the most forward looking reports we have. This projects growth 6 months out, so it is a good news number that will make it difficult for rates to drop on the news, it may even apply some upwards pressure on rates.
Did anyone else notice how busy Wednesday is? I would say that Wednesday is the big day for a few reasons, Both CPI and Retail sales have the ability to jump up and bite investors. Most likely they will come in as projected, but if we are to get a shocker that might move the market this week my money is one one of these. In the absence of any shocker we will have the DOW to look towards for direction. If we continue to see stocks climb we might see rates climb with it, but you would have to think that stocks are nearing a point of a small correction, most likely in the form of profit taking. It will only take one bad earnings report to scare investors out of equities, taking their profits and parking cash in the safety of the credit markets. If we see a significant sell off it is likely we will see a rally in the credit markets that will help keep rates low and possibly show us a little improvement.
That is this weeks 2 cents worth! Have a great week!
Rob
Mortgage Banker
NMLS ID# 248937
www.RobertRaufHomeLoans.com or my blog: http://activerain.com/blogs/rrauf
(732)223-1630 x102
Since 1987 I have been helping my clients fulfill their dream of home ownership!
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