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Mortgage Update

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Mortgage and Lending with Caliber Home Loans 288509


Market Comment - Week of May 30th, 2011

Mortgage bond prices rose last week pushing mortgage interest rates slightly lower. Rates were helped by some flight to quality buying of US debt instruments tied to Euro debt uncertainty. Italy's credit outlook was downgraded and Greece's debt situation remained in turmoil. New home sales data was stronger than expected while durable goods orders surprised to the downside. Gross domestic product data came in weaker than expected which helped hold rates steady. Mortgage bonds ended the week better by about 1/8 of a discount point.

The employment report will be the most significant release this week. The bond market is closed Monday for the holiday and conditions may be volatile Tuesday morning when trading resumes.


Economic Factors

Economic Indicator

Release Date Time

Consensus Estimate

Analysis

Consumer Confidence

Tuesday, May 31, 2011

72

Important. An indication of consumers' willingness to spend. Weakness may lead to lower mortgage rates.

ADP Employment

Wednesday, June 1, 2011

150k

Important. An indication of employment. Weakness may bring lower rates.

ISM Index

Wednesday, June 1, 2011

60.2

Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates.

Construction Spending

Wednesday, June 1, 2011

Up 0.8%

Low importance. An indication of economic strength. Significant weakness may lead to lower rates.

Weekly Jobless Claims

Thursday, June 2, 2011

415k

Important. An indication of employment. Higher claims may result in lower rates.

Revised Q1 Productivity

Thursday, June 2, 2011

Up 3.2%

Important. A measure of output per hour. Improvement may lead to lower mortgage rates.

Factory Orders

Thursday, June 2, 2011

Up 0.7%

Important. A measure of manufacturing sector strength. Weakness may lead to lower rates.

Employment

Friday, June 3, 2011

9%, 150k

Very important. An increase in unemployment or weakness in payrolls may bring lower rates.

 

Productivity

Productivity is the rate at which goods or services are produced. It is most commonly defined in terms of labor, which is the contribution of people to the process. Labor costs represent about two thirds of the value of the output produced. The Bureau of Labor Statistics of the US Department of Labor releases the most widely cited productivity statistics quarterly and annually. Increased productivity is often credited for economic growth with little signs of inflation.

Productivity is significant in that as it increases, businesses can produce more with the same or less input. This wealth building effect is vital to the US economy. As productivity increases, the US economy generally performs better. As productivity decreases, the economy generally suffers. While the bond market generally favors signs of weakness in the economy, bonds tolerate growth as long as the economic environment shows little or no inflationary pressures. Keep in mind that rates remain very favorable. Now is a great time to avoid the uncertainty surrounding continued market volatility.


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6025 S. Quebec Street #110
Centennial, CO 80111 

 

 

 

 

 

 

Jason Keith
Senior Loan Officer

Office: 720-489-0712
e-Fax: 866-445-5694
Cell: 303-263-6135 

jkeith@wrstarkey.com
www.LoansFromJason.com 
NMLSR# 288509
LMB100018303

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Views and opinions expressed on this site are not necessarily those of Starkey Mortgage.

Jason M. Keith
Senior Loan Officer
LMB100018303
NMLSR # 288509
Cell: 303-263-6135
jkeith@starkeymtg.com

Starkey Mortgage

6025 S. Quebec Street

Suite 110

Centennial, CO 80111

To check the license status of your mortgage loan originator, visit http://www.dora.state.co.us/real-estate/index.htm.