Mortgage rates for today will start off the day at similar levels to yesterday as this morning’s Employment report was within expectations. Over the last few days there have been several reports that a deal with China is near and that continues to add pressure to bonds and mortgage rates.
The good news is that mortgage rates remain near their recent lows despite the US-China trade talk headlines.
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Mortgage Backed Securities and Treasury Snapshot:
Mortgage Backed Security FNMA 4.0 opened the day at 102.61, and FNMA 3.5 opened the day at 101.00. The 10y Treasury yield started the day at the 2.53% level.
The initial move post Employment report was positive however that reversed course and the 10y yield moved above 2.54%. The FNMA 4.0 coupon was at 102.59 post report and the FNMA 3.5 coupon was at 99.03 post report.
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Economic Data – This Week:
Today we have the BLS Employment report.
The Employment Report And Mortgage Rates:
This morning’s employment report was both a positive and somewhat negative for mortgage rates. The number of jobs created came in higher than expectations (196k vs 180k) which is somewhat of a negative however Average Earnings came in below expectations (01. vs 03) and this is generally viewed as positive for mortgage rates.
Why are lower wages a positive for mortgage rates? Lower wages helps keep inflation in check and stable/lower inflation is a big positive for mortgage rates/bonds.
China Trade News May Decide The Direction Of Mortgage Rates:
With no major economic reports until next Wednesday the bond markets and mortgage rates might end up being at the “mercy” of any trade deal news with China. This can actually be good for mortgage rates as well (unlikely though). If the recent rumors of a trade deal being nearly reached turn out not to be true (which has been the case the previous times we’ve heard this) then that could end up being a positive for mortgage rates. Much of the move up over the last week can be attributed to US-China trade negotiations.
A move higher in mortgage rates is expected if a trade deal is announced however it could be a short term move as the announcement and implementation are two different things. The trade deal would still have to be approved by Congress and that could take a very long time.
Economic Data – Next Week:
On Monday we have Factory orders, on Wednesday we wave the weekly Mortgage Market Index and Core CPI. On Thursday we have Core Producer Prices and on Friday we have Import and Export Prices along with 1yr and 5yr Inflation Outlook.
JB Mortgage Capital, Inc.:
We offer industry low mortgage rates for both refinance and purchase transactions, personal one-on-one service and we have an A+ rating with the Better Business Bureau (BBB). We also have a top rating with the Business Consumers Alliance (AAA). We utilize the latest technology to ensure a fast closing and Loan Officer Kevin O’Connor has over 14 years of experience as a mortgage professional.
When it comes to mortgage rates please keep in mind that mortgage rates adjust daily; sometimes they adjust multiple times in a day when the bond market is volatile. Also things like obtaining cash out, lower credit scores, higher Loan-To-Value ratios, rental properties and the subordination of a second mortgage will cause in an increase in your mortgage rate.
To obtain the most up-to-date quote, specific to your loan scenario be sure to contact Loan Officer Kevin O’Connor at 1-800-550-5538 or you can submit a “Contact Us” request on the our website.