Mortgage Market Snapshot

Mortgage Market Snapshot - 1/22/2008

Jim Beech — Tue, 22 Jan 2008 17:28:49 GMT

1/22/08 Market Snapshot

Foreign weakness in the stock market and increasing recession concerns in the U.S. caused the Federal Reserve to make an unprecedented .75 percent reduction to both the Fed Funds Rate and the Discount Rate. Their goal is to loosen credit, lower mortgage rates, stimulate spending and investment, reduce short term interest rates and restore confidence to our economy. A reduction of this magnitude has not been seen in 24 years. Further underscoring the concern for our economy is the fact that this change occurred between FOMC meetings. Many market analysts expect a further reduction at next weeks FOMC meeting. Meanwhile, the stock market reacted quickly this morning as it lost as much as 400 points shortly after the open. Treasury yields have rallied and mortgage prices improved as well.

Mortgage Market Snapshot - 10 Dec 2007

Jim Beech — Mon, 10 Dec 2007 21:47:20 GMT

12/10/07 Market Snapshot

The markets reacted negatively to the jobs reports on Friday as the hourly earnings report renewed concerns about inflation. The big news this week will be the FOMC meeting, and the accompanying announcement by the Feds regarding a change in rates. Most analysts are predicting the Feds will drop rates by .25 pt.; although, a few are expecting a .50 pt. reduction. In addition, later this week we have CPI and PPI numbers being reported, and the markets will be watching closely due to inflationary concerns.

Mortgage Market Snapshot - 11/26/2007

Jim Beech — Mon, 26 Nov 2007 18:33:53 GMT

11/26/07 Market Snapshot

The mortgage markets bounced around last week due to the short work week and limited economic news being reported. The big news for the week was the release of FOMC minutes from the 10/31/07 meeting, and the loss reported by Freddie Mac. We have a full calendar of economic news to be reported this week, much of it coming at the end of the week. Treasury yields on the 10 yr. Note have dropped below 4.00%.

Mortgage Market Snapshot

Jim Beech — Mon, 22 Oct 2007 21:34:19 GMT

10/22/07 Market Snapshot

The 10 yr. bond yield dropped last week due to a combination of weaker than expected economic growth, stable inflation data and an increase in political tension around the globe. The lower yield caused mortgage rates to drop for the week. The political tension caused a flight to quality as we saw money flow out of stocks and into bonds. With no economic news being reported until Wednesday of this week, we mortgage rates should continue to be stable.

Mortgage Market Snapshot - 15 October 2007

Jim Beech — Mon, 15 Oct 2007 17:14:17 GMT

10/15/07 Market Snapshot

After a fairly quiet week last week bonds performed poorly on Friday after the Producer Price Index unexpectedly jumped 1.1%. The increase was largely due to increasing energy prices, and lead investors to fear that inflation is may be creeping in. Lenders will be watching to see what impact Wednesday’s Consumer Price Index (CPI) report has on the bond market. The CPI number is the most widely watched number by the Feds for indications of inflation.

Mortgage Market SnapShot - 9/24/07

Jim Beech — Mon, 24 Sep 2007 17:26:23 GMT

9/24/07 Market Snapshot

Following the Feds decision to cut rates, the treasury prices and Mortgage Backed Securities immediately rallied, then reversed to close lower on the week. The reversal came as market players became concerned about the risk of future inflation. The .50 pt. improvement was more than most analysts had forecast. It may take several more days for the markets to fully digest the possible implications of the fed move, so mortgage rates may be jittery for the next several days. This week we’ll see substantial amounts of economic news reported, mostly on Thursday and Friday. The markets will be especially focused on Home Sales data to be released, beginning on Tuesday.

Mortgage Market SnapShot - 17 Sept 2007

Jim Beech — Mon, 17 Sep 2007 18:38:13 GMT

9/17/07 Market Snapshot

All eyes are on the Feds this week as they meet Tuesday for an FOMC meeting. Most analysts believe the Fed Funds rate will be reduced at the meeting; the big question is how much. The treasury yields have risen over the past several days as the stock market strengthened. Look for mortgage rates to improve after the Feds reduce the rate, as long as they don’t raise the level of inflation fear. If the markets perceive that inflation will become a factor with lower rates, mortgage rates could possible go up.

Mortgage Market Snapshot - 10 Sept 2007

Jim Beech — Mon, 10 Sep 2007 21:20:08 GMT

9/10/07 Market Snapshot

Mortgage Back Security (MBS) prices continue to improve and mortgage rates are dropping as the 10 yr. bond yield drops. Pressure is mounting for the Feds to reduce the Fed Funds rate at their next meeting on September 18^thand most financial markets have already priced the expected reduction into their pricing. However, several Fed officials have recently commented that the Fed continues to be resistant to reducing the rate because of inflationary concerns. Focus this week will be on the Retail Sales and Industrial Production numbers on Friday.

Mortgage Market Snapshot - 27 Aug 2007

Jim Beech — Mon, 27 Aug 2007 17:13:10 GMT

8/27/07 Market Snapshot

The gap between Mortgage Backed Securities (MBS) and the 10 yr. treasury yield has narrowed over the past week, with prices for mortgage backed securities improving. This is positive for the mortgage markets as the Conforming 30 yr. fixed rate hit it’s lowest level since May. Focus continues to be on the Feds as market watchers wait to see how the Fed will respond to the continued credit crisis. Expectations have been that the Feds may reduce the Fed Funds rate prior to the next FOMC meeting; however, the positive New Home Sales and Existing Home Sales numbers may cause the Feds to hold off on losing the rates.

Mortgage Market Snapshot - 7/20/2007

Jim Beech — Mon, 20 Aug 2007 16:03:19 GMT

8/20/07 Market Snapshot

The Federal Reserve reduced the Discount Rate by .50 pt. on Friday, and first indications are that they did not achieve their desired results. Continued pressure remains for the Feds to cut the Fed Funds rate, which is widely expected to more directly impact consumer rates. The 10 yr. bond yields continue to climb as bond prices increase due to demand.