Rate Lock Advisory

Tuesday, April 15th

Tuesday’s bond market has opened in positive territory again, following suit of the major stock indexes. The Dow is up 210 points while the Nasdaq has gained 122 points. The bond market is currently up 3/32 (4.37%), but gains late yesterday are going to allow for an improvement of approximately .250 - .375 of a discount point in this morning’s pricing. If you saw an intraday improvement late yesterday, you should see a smaller improvement this morning. Most of the move between Monday’s early pricing and today’s rates comes from that late rally yesterday.

3/32

Bonds

30 yr - 4.37%

210

Dow

40,735

122

NASDAQ

16,954

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

High

Unknown

Retail Sales

Tomorrow has a full schedule of activities that we will be watching with two morning reports and two afternoon events that may have an impact on rates. The day will begin with the release of March's Retail Sales report at 8:30 AM ET, giving us a key and highly influential measure of consumer spending. This data is relevant because consumer spending fuels economic growth since it makes up over two-thirds of the U.S. economy. Forecasts have sales rising 1.3% from February with a 0.4% increase if more volatile and costly auto transactions are excluded. Analysts are expecting a large increase due to the assumption consumers went on a buying spree last month before tariffs went into effect. Good news for rates would be a much smaller increase in sales, but the markets haven’t paid too much attention to the typical relevant economic data lately.

Medium

Unknown

Industrial Production

The sales report will be followed by March's Industrial Production data at 9:15 AM ET. It helps us measure manufacturing strength by tracking output at U.S. factories, mines and utilities. Analysts are predicting a 0.2% decline in production, hinting at weakness in the manufacturing sector. This data is considered to be only moderately important for the markets though. The earlier sales data is much more likely to have an impact on rates than this report. Weaker manufacturing activity is generally considered to be favorable news for mortgage rates.

Medium

Unknown

Treasury Auctions (5,7,10,20,30 year)

There is a 20-year Treasury Note auction taking place tomorrow. These types of sales don't directly affect mortgage rates, although they can impact broader bond trading sentiment that has the potential to indirectly move rates slightly. A strong demand from investors could lead to bond gains and a minor improvement in mortgage pricing after results are announced at 1:00 PM ET. It is worth noting that both of last week’s auctions drew a much stronger demand than many had expected, leaving us optimistic about this week’s sale.

High

Unknown

Fed Talk

Finally, Fed Chairman Powell is participating in a discussion at 1:30 PM ET at the Economic Club of Chicago. The topic of the event is listed as Economic Outlook. There are plenty of Fed-member speeches this week, but this is the one that is most likely to affect the markets and mortgage rates. His appearance earlier this month contributed to the chaos in the markets when he reminded the audience that the Fed does not have a mandate to stabilize the financial markets. Whenever he speaks, the markets listen. Any surprises will draw a strong reaction, likely leading to an afternoon revision in mortgage rates.

Float / Lock Recommendation

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... Float 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.