Mortgage Newsletter- March 25th, 2013 Dana Bain Premiere Mortgage

By
Mortgage and Lending with Premiere Mortgage Services Inc. MLO 18693

http://www.bainmortgage.com/MortgageMarketWeekInReview

Newsletter-March 25th, 2013
Provided by
Dana Bain & Robin Dunbar Bain

Dana Bain
Premiere Mortgage Services

www.BainMortgage.com

11 Malvern Hill Road
Sterling, MA 01564
Phone: (978) 422-2311
Fax: (978) 422-2313
E-Mail: dana@bainmortgage.com

 
 
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Market Comment

Mortgage bond prices finished the week slightly positive which helped rates improve. Rates fell sharply Monday morning in flight to quality buying of mortgage bonds which followed reports from the euro zone of a Cyprus bailout. Unfortunately a significant portion of the improvements were erased following Fed Chairman Bernanke’s comments (story below.) The data did not help either. Weekly jobless claims were not as high as expected, the Philadelphia Fed survey was stronger than expected, and Leading Economic Indicators were also stronger than expected. The good news was that most rates finished the week about 1/8 of a discount point lower despite the up and down trading.

LOOKING AHEAD

Economic
Indicator

Release
Date & Time

Consensus
Estimate


Analysis

Durable Goods Orders

Tuesday, March 26,
8:30 am, et

Down 0.2%

Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates.
Consumer Confidence

Tuesday, March 26,
10:00 am, et

67 Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.
New Home Sales

Tuesday, March 26,
10:00 am, et

442k

Important. An indication of economic strength and credit demand. Weakness may lead to lower rates.
2-year Treasury Note Auction

Tuesday, March 26,
1:15 pm, et

None

Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
5-year Treasury Note Auction Wednesday, March 27,
1:15 pm, et
None Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Weekly Jobless Claims Thursday, March 28,
8:30 am, et
342k Important. An indication of employment. Higher claims may result in lower rates.
Q4 GDP 3rd estimate Thursday, March 28,
8:30 am, et
Up 0.2% Important. The aggregate measure of US economic production. Weakness may lead to lower rates.
7-year Treasury Note Auction Thursday, March 28,
1:15 pm, et
None Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Personal Income and Outlays Friday, March 29,
8:30 am, et
Unchanged,
Up 0.1%
Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates.
PCE Core Inflation Friday, March 29,
8:30 am, et
Up 0.1% Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve.
Consumer Sentiment Friday, March 29,
10:00 am, et
71 Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.

Bernanke

Fed Chairman Ben Bernanke caused some turmoil in the bond market last week with his remarks that followed the Fed meeting. The Fed kept rates unchanged and did not deviate much from their prior position to hold rates low until unemployment falls below 6.5%. However, Bernanke followed that release with a warning that the Fed could adjust the size of monthly bond purchases in response to changing economic conditions. That ignited trader fears. Mortgage bond prices saw a significant selloff which sent prices lower and mortgage interest rates higher that afternoon. The Fed has purchased trillions of dollars of Treasury and mortgage bonds in an effort to keep rates low. A deviation from that practice will result in additional rate volatility. 

 

 
 
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MORTGAGE MARKET IN REVIEW Newsletter-March 25th, 2013
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