Mortgage rates for March 28, 2019 remain near their two-year low as we finish out the last few days of March. Fears of a recession have caused investors to rush into the bond market which has pushed mortgage rates lower. When bond market investors are concerned about the economy they buy more bonds which is good for consumer mortgage rates.
Mortgage Backed Securities and Treasury Snapshot:
Mortgage Backed Security FNMA 4.0 opened the day at 102.98, and FNMA 3.5 opened the day at 101.45. The 10y Treasury yield started the day at the 2.36% level.
FHA Mortgage Rates
Jumbo Mortgage Rates
Economic Data – This Week:
Today we have the final Q4 GDP reading and Pending Home Sales (February). To finish off the week we have the Personal Income report (February), Consumer Spending (January), Core PCE (January), Chicago PMI (March), Consumer Sentiment (March) and New Home Sales (February).
Final Q4 GDP Reading:
Expectations were for a 2.4% reading and the final number came in at 2.2%. The final GDP report usually has little to no impact on mortgage rates since there are several prior GDP reports.
Economic Data – Next Week:
On Monday we have two very important reports; Retail Sales for February and the ISM Manufacturing PMI data for March. These have the potential to be market moving reports and it’s important to keep a close eye on how the market reacts.
On Tuesday we have the Durable Goods report and the ISM-New York Index for March. On Wednesday we have the weekly Mortgage Market Index, ADP Employment report and ISM Non-Manufacturing report. On Friday we have the BLS Employment report.
Recession Fears Sparks Massive Bond Market Rally:
A little less than six months ago the 10y yield was moving above 3.20%. Nearly everyone was saying how great the economy was and in 2019 we could see the 10y yield move above 4.00%.
Since then we’ve seen the economy stall and the 10y yield move below 2.40% as investors fear the economy may be heading into a recession.
Back in late November and early December evidence of a slow down in the economy started to emerge. Both the bond market and mortgage rate started improving as the economy faced two significant headwinds: the Government Shutdown and the trade war with China. The weakening economy was attributed to those two hurdles.
With the shutdown behind us more analyst and investors are starting to fear that this slow down may get worse. With Europe and Asia seeing a significant decline in economic growth it’s clear that the US Economy will be under some pressure due to the fact that our economic health is dependent on a healthy world economy.
As recession fears are a positive for mortgage rates however at some point the market will reach a point in which those fears will be fully priced in. Once that happens you may see mortgage rates move higher as bond market investors take profits.
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.