Monday, October 20th
Monday’s bond market has opened in positive territory to start the week with a small improvement in rates. Stocks are rallying with the Dow up 282 points and the Nasdaq up 238 points. The bond market is currently up 2/32 (4.00%), which should improve this morning’s mortgage rates slightly if compared to Friday’s early pricing.
2/32
Bonds
30 yr - 4.00%
282
Dow
46,473
238
NASDAQ
22,918
Trailing 90 Days - National Average
Medium
Neutral
This week brings us the release of much more relevant economic data than the past couple, despite the being government in the third week of its shutdown. This morning’s scheduled release of September’s Leading Economic Indicators from the Conference Board has been delayed. Still, there are several economic reports from non-governmental agencies set to be posted this week, along with the highly important Consumer Price Index that will tell us what consumer level inflation looks like. All of them come during the latter days.
Medium
Unknown
In addition to the data there also is a Treasury auction midweek that we will be watching. If Wednesday’s 20-year Treasury Bond auction is met with a strong demand from investors, particularly international buyers, bond prices may rise during afternoon trading that day.
High
Unknown
Overall, Friday is likely to have the largest change in mortgage rates due to the major inflation data being released (CPI). Tomorrow is a good candidate for calmest day, unless something unexpected happens. The benchmark 10-year Treasury Note yield tried to break below the 4.00% threshold last week, but failed to do so. It is testing again this morning. Failure to move below that threshold and staying would be troublesome for mortgage shoppers because it makes a trend in the upward direction more likely and mortgage rates tend to track bond yields. This week's trading could help solidify the direction of yields and mortgage rates over the next few weeks, so it would be prudent to keep an eye on the markets if still floating a rate and closing in the near future.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.