Mortgage Rates and What May Move Them This Week: July 12, 2010

Reblogger Catherine Chaudemanche - Edison & Central NJ
Real Estate Agent with Metuchen Keller Williams Elite Realty / Middlesex County, NJ

Original content by Robert Rauf NMLS 248937

 

 Last week was a short one, and fairly quiet. We did get a bit of mixed news that caused some back and forth bounces for the week, but we still ended the week with Fannies up about 7/32nds helping to solidly keep interest rates at the lowest point in GENERATIONS... Crazy low rates today, We have been locking 30 year fixed rates for highly qualified buyers in the Mid 4's....

This week has a busy schedule of data and auctions to chew on, Here is the calendar:

  • Monday July 12: Auction number one with the Treasury selling $35 Billion in 3 year notes. The shorter term auctions have typically been well bid and I expect that this one will be as well This should be supportive of steady rates. Ahead of the auction (which happens at 1pm) the market is trading in slightly positive territory.
  • TuesdayJuly 13: Auction #2 with $21 Billion in 10 year notes. With the longer term of this offering and the fact that rates are already so darn low we can only hope that the outcome of this auction is supportive of steady rates... There is a pretty good chance that this may put some upward pressure on rates today.
  • Wednesday, July 14: June Retail Sales expected -0.2% Ex Auto 0.0%. As forecast this will show the weakness in retail, and remember, the economy is 70% consumer driven. If we are surprised by a stronger than expected number here it will cause rates to climb.
  • Wednesday: May Business Inventories expected +0.3%. Snoozer alert, not much more than a place holder on the calendar.
  • Wednesday: Third Auction of the week with $13 billion in 30 year bonds. I expect that investors will hold back on this one, after all - would you want to invest money for the long run with such crappy returns?  It is likely this WILL cause upwards pressure on rates today.
  • Wednesday: Minutes of the June FOMC meeting. There are no surprises expected here, it is likely to mention the weakness of the labor market and how that is holding back the economy. This is not a likely market mover.
  • Thursday July 15: Initial Jobless claims expected down 4,000. Seasonally adjusted numbers are always harder to chew on, so while this shows some improvement there is enough doubt behind the calculation that is likely to keep it on the back burner, and even with the projected improvement the weekly number is still 450k.
  • Thursday: June PPI expected -0.1% with a core of +0.1%. This report should confirm that there is no fear of inflation at the producer level so it should be supportive of steady rates.
  • Thursday: June Industrial Production expected -0.1% and Capacity 74.1. Production is expected to be down for the first time in a few months and capacity is still low, keeping inflationary fears stashed on the shelf. This should not be a market mover.
  • Friday July 16: June CPI expected 0.0% with a core of +0.1%. If we see a higher core rate of inflation at the consumer level it is likely we will see a pop up in rates, as forecast it is supportive of steady rates.

Mortgage rates hit the lowest Levels last week. That it self is scary enough to say "look out" The farther the rubber ball drops the higher the bounce, and rates have come down a lot so I wont be surprised when the market starts taking profits and we see rates bump up. Long term rates will not stay at these crazy low levels forever, the WILL GO UP and there certainly is much more room for rates to go up than for rates to go down.

If you interested in a Mortgage, or know of someone that is, please feel free to give me a call or send me an Email, I would be happy to help!

Have a great week!

Rob

Robert Rauf

Mortgage Banker

NMLS ID# 248937

www.RobertRaufHomeLoans.com   or my blog: http://activerain.com/blogs/rrauf

(732)223-1630 x102

RRauf@REMN.com

Since 1987 I have been helping my clients fulfill their dream of home ownership!

Real Estate Mortgage Network Inc.

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Rainmaker
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Robert Rauf
HomeBridge Financial Services (NJ) - Toms River, NJ

Thank you for the Re-blog Cathy! I hope you have a great week

Jul 13, 2010 06:24 AM #1
Rainmaker
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Catherine Chaudemanche - Edison & Central NJ
Metuchen Keller Williams Elite Realty / Middlesex County, NJ - Edison, NJ
Full Time, Informed and Involved- Results Driven

Busy week for sure...:)

Jul 14, 2010 12:46 AM #2
Rainmaker
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Robert Rauf
HomeBridge Financial Services (NJ) - Toms River, NJ

I hope it is busy and productive!  Dont forget to give me a call if you need any mortgage help! :)

Jul 14, 2010 09:08 AM #3
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Rainmaker
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Catherine Chaudemanche - Edison & Central NJ

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