Mortgage News for Week Ending June 28, 2013

Mortgage and Lending with C2 Financial NMLS# 331867

Fed Speeches Drive Markets

It was another incredibly volatile week as investors attempted to determine the impact of last week's Fed announcement on mortgage rates. Early in the week, mortgage rates continued to move higher, but soothing comments from Fed officials caused mortgage rates to reverse direction. After all the daily swings, mortgage rates ended the week a little lower.

A number of Fed officials made speeches this week, and the common theme was that investors overreacted to last Wednesday's Fed statement. Fed officials were surprised by the magnitude of the increase in yields on Treasuries and mortgage-backed securities (MBS), and the resulting increase in mortgage rates, as demanded by investors. Their comments were effective. MBS prices improved and mortgage rates reversed some of the recent increase.

Based on the results of their weekly survey, Freddie Mac reported that mortgage rates rose this week and did so by a record amount. As mentioned above, rates this week actually moved lower. The difference comes from the timing of the Freddie Mac survey. Freddie Mac collects its data early each week. The increase they reported this week is really comparing mortgage rates pre-Fed meeting to post-Fed meeting. When MBS prices and mortgage rates are as volatile as they have been recently, the Freddie Mac survey results can be misleading.



Week Ahead

The big story next week will be Friday's Employment report. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month, and it will carry even more weight than normal due to how it will influence Fed policy. Earlier in the week, ISM Manufacturing and Construction Spending will be released on Monday. Factory Orders will come out on Tuesday. ISM Services, ADP Employment, and the Trade Balance are scheduled for Wednesday. Mortgage markets will be closed on Thursday in observance of Independence Day.

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Derek McClintock, CMP

Certified Mortgage Planner | Senior Loan Officer

Mortgage Broker | Direct Lender

Direct Phone: 619-647-3069



NMLS #331867 | CA BRE# 01361776

C2 Financial Corporation NMLS#135622 | CA BRE# 01821025


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The views expressed in this blog are of Derek McClintock and not C2 Financial Corporation.


This licensee is performing acts for which a real estate license is required. C2 Financial is licensed by the California Dept. of Real Estate, Broker # 01821025; NMLS # 135622.



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