Mortgage Market Commentary week of 12/19 - 12/23/11
Well as the week closes in on Christmas and vacations abound, I see tomorrows data as only a slight risk of much movement for the remainder of this week, as it is already being priced in.
Pricing is at solid levels and,although down a touch from its highs earlier in the week, still very favorable! the cause of the downward pressure is two-fold. First you have the dollar doing well and we had a modest appetite at todays auction of 29B worth of 7yr Treasuries.
Here is tomorrow's market driving / factor data...
Initial Claims: Consensus 380K, prior 366K
Continuing Claims: Consensus 3650K, prior 3603K
GDP - Third Estimate: Coinsensus 2.0%, prior 2.0%
GDP Deflator - Third Estimate: Consensus 2.5%, prior 2.5%
Michigan Sentiment - Consensus 68.0, prior 67.7
Unless these numbers come in with much difference (either direction) tomorrow, dont expect to see much change next week either (other than the typical profit takers for end of year).
Currently the FNMA 3.5 coupon is trending down closing at 102.25 which is 50 bps down from its mid week high.
The 10Y Treasury is following suit and ended today down -14/32 with its yields at 1.975%(still a very strong number being below 2%)
Advice: LOCK now while pricing is still at excellent levels and remove the year end risk, is my call.
To all... Have a Merry Christmas and a Happy Healthy and Prosperous New Year!!! 2012!?!?! Hard to believe...
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