Tuesday’s bond market has opened in positive territory despite no relevant economic data scheduled for release today. The stock markets are showing modest gains with the Dow up 3 points and the Nasdaq up 6 points. The bond market is currently up 7/32, which will likely improve this morning’s mortgage rates by approximately .125 of a discount point.
There is no relevant news scheduled for release until tomorrow afternoon’s Federal Open Market Committee minutes. Market participants are interested in how divided the Fed is towards rate hikes and possible future moves. The minutes give us insight to their current thought process and individual Fed member opinions. Any surprises in the 2:00 PM ET release could cause afternoon volatility in the markets tomorrow and possible changes in mortgage pricing.
Thursday’s 10-year Treasury Inflation Protected Security (TIPS) sale could lead to some weakness in bonds ahead of the auction as investing firms sell current holdings to prepare for it. This weakness is usually only temporary if the sales are met with a decent demand. The results of the sale will be posted at 1:00 PM ET. If the demand from investors was strong, the bond market could rally during afternoon trading, leading to lower mortgage rates. If the sales were met with a poor demand, the afternoon weakness may cause upward revisions to mortgage pricing Thursday afternoon.
The benchmark 10-year Treasury Note seems to be moving away from the upper end of its recent trading range. This leads me to believe that bonds are more apt to mover higher (pushing its yield lower) in the immediate future unless we get surprisingly strong data Friday. Accordingly, it is probably safe to float your interest rate for the moment if you are currently in the process of financing a property. However, be ready to lock, if possible, if we get bad news from the FOMC minutes.
Craig Higdon has over 14 years experience in financing commercial loans, small business loans, construction loans, and land loans. He owns Excelsion Mortgage, a commercial mortgage brokerage offering real estate investors a wide range of resources to help them in their investment activities.
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Mortgage Loan Market Commentary
FOMC MINUTES RELEASED ON WEDNESDAY
Tuesday’s bond market has opened in positive territory despite no relevant economic data scheduled for release today. The stock markets are showing modest gains with the Dow up 3 points and the Nasdaq up 6 points. The bond market is currently up 7/32, which will likely improve this morning’s mortgage rates by approximately .125 of a discount point.
There is no relevant news scheduled for release until tomorrow afternoon’s Federal Open Market Committee minutes. Market participants are interested in how divided the Fed is towards rate hikes and possible future moves. The minutes give us insight to their current thought process and individual Fed member opinions. Any surprises in the 2:00 PM ET release could cause afternoon volatility in the markets tomorrow and possible changes in mortgage pricing.
Thursday’s 10-year Treasury Inflation Protected Security (TIPS) sale could lead to some weakness in bonds ahead of the auction as investing firms sell current holdings to prepare for it. This weakness is usually only temporary if the sales are met with a decent demand. The results of the sale will be posted at 1:00 PM ET. If the demand from investors was strong, the bond market could rally during afternoon trading, leading to lower mortgage rates. If the sales were met with a poor demand, the afternoon weakness may cause upward revisions to mortgage pricing Thursday afternoon.
The benchmark 10-year Treasury Note seems to be moving away from the upper end of its recent trading range. This leads me to believe that bonds are more apt to mover higher (pushing its yield lower) in the immediate future unless we get surprisingly strong data Friday. Accordingly, it is probably safe to float your interest rate for the moment if you are currently in the process of financing a property. However, be ready to lock, if possible, if we get bad news from the FOMC minutes.
Craig S. Higdon, “The Investment Property Insider”
www.ExcelsionMortgage.com, www.InvestmentPropertyInsider.com
Craig Higdon has over 14 years experience in financing commercial loans, small business loans, construction loans, and land loans. He owns Excelsion Mortgage, a commercial mortgage brokerage offering real estate investors a wide range of resources to help them in their investment activities.
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