Mortgage Market Week In Review 8/10/2009 Dana Bain

Newsletter-August 10th, 2009 Provided by Dana & Robin Bain Dana Bain Premiere Mortgage Services 11 Malvern Hill Road Sterling, MA 01564 Phone: (978) 422-2311 Fax: (978) 422-2313 E-Mail: dana@bainmortgage.com Market Comment Mortgage bond prices fell last week pushing mortgage interest rates higher. Stronger than expected data and positive stock movements pressured rates. The Institute for Supply Management (ISM), factory orders, weekly jobless claims, and employment report all came in stronger than expected. The personal income and outlays data was the only release that was even near expectations. Signs of recovery in the economy with continued record debt had many traders concerned about inflation implications. Inflation erodes the value of fixed income securities. For the week interest rates rose by about 2 full discount points. The record debt auctions will continue to pressure mortgage interest rates. If foreign demand does not falter then mortgage interest rates will likely stay neutral or improve. However, weak foreign demand would likely have the opposite effect. LOOKING AHEAD Economic Indicator Release Date & Time Consensus Estimate Analysis Preliminary Q2 Productivity Tuesday, Aug. 11, 8:30 am, et Up 4.9% Important. A measure of output per hour. Improvement may lead to lower mortgage rates. 3-year Treasury Note Auction Tuesday, Aug. 11, 1:30 pm, et None Important. $37 billion of notes will be auctioned. Strong demand may lead to lower mortgage rates. Trade Data Wednesday, Aug. 12, 8:30 am, et $28.5 billion deficit Important. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates. 10-year Treasury Note Auction Wednesday, Aug. 12, 1:30 pm, et None Important. $23 billion of notes will be auctioned. Strong demand may lead to lower mortgage rates. Fed Meeting Adjourns Wednesday, Aug. 12, 2:15 pm, et No change Important. Few expect the Fed to change rates, but some volatility may surround the adjournment of this meeting. Retail Sales Thursday, Aug. 13, 8:30 am, et Up 0.3% Important. A measure of consumer demand. A smaller than expected increase may lead to lower mortgage rates. 30-year Treasury Bond Auction Thursday, Aug. 13, 1:30 pm, et None Important. $15 billion of bonds will be auctioned. Strong demand may lead to lower mortgage rates. Consumer Price Index Friday, Aug. 14, 8:30 am, et Unchanged, Core up 0.2% Important. A measure of inflation at the consumer level. Lower figures may lead to lower rates. Industrial Production Friday, Aug. 14, 9:15 am, et 68.1% Important. A measure of manufacturing sector strength. Weakness may lead to lower rates. Capacity Utilization Friday, Aug. 14, 9:15 am, et Up 0.1% Important. A figure above 85% is viewed as inflationary. Weakness may lead to lower rates. Employment Surprise The employment report is generally the most important data released each month. Last week’s employment report shocked analysts and the market when all three components came in better than expected. Unemployment came in @ 9.4%, stronger than the expected 9.6% mark. Non-farm payrolls fell 247k, not as weak as the expected 320k decline. Average hourly earnings rose 0.2%, stronger than the expected 0.1% increase. Unfortunately mortgage interest rates got worse by over 1/2 a discount point instantly following the release. Be cautious here as economic uncertainty continues. As we saw last week, lower rates are not a given. MORTGAGE MARKET IN REVIEW Newsletter-August 10th, 2009 Today's Rates: Mtg Loan Rate APR 30-yr Fixed 5.22% 5.39% 15-yr Fixed 4.63% 4.87% 1-yr Adj 4.78% 5.93% * national averages Real Estate News from Forbes.com: America's Best And Worst Housing Markets Big Sky Buys Forbes Luxury Housing Index More news... These articles are property of Forbes.com and protected by copyright. -------------------------------------------------------------------------------- Mortgage Calculator: Sales Price: $ Down: % Interest Rate: % Term: yrs Monthly payment: $ Massachusetts License Number MB1205 Licensed by the New Hampshire Banking Department- License Number 5430-MBR Privacy Policy PREMIERE MORTGAGE SERVICES INC. 11 Malvern Hill Rd Sterling, MA 01564-2829 Phone: 978-422-2311 Toll Free Phone: 1-800-480-0545 Fax: 978-422-2313 E-mail: Dana@BainMortgage.com Contact Us | Home | Loan App Checklist | Loan Application | The Loan Process | When to get Qualified | Loan Application Info | What is a credit score? | Rate Lock Periods | Mortgage Calculators | Rate Sheet | Customer Login | Daily Rate Lock Advisory | My Blog Copyright © 2009 PREMIERE MORTGAGE SERVICES INC. Portions Copyright © 2009 a la mode, inc.