This caused mortgage rates to spike from Wednesday to Friday and it caused the "lowest rates of all-time" to seem like an opportunity lost.
It's the first time in 4 weeks that mortgage rates rose overall.
Last week was a strange week, to say the least. Aside from the large docket of economic data, there was also:
- A Federal Reserve meeting
- 160 of the S&P 500 firms reporting earnings
- A global public health emergency
It all combined to make for a volatile week in mortgages and the biggest losers were the people that hadn't yet locked a mortgage rates. Based on the current market, each quarter-percent that mortgage rates rose added $32 per month per $100,00 borrowed.
This week, the market should be similarly jumpy.
Early in the week, there's not much data to sway markets, nor is there much in the way of public policy. Therefore, expect external factors like the Swine Flu to dictate the market's path. If the outbreak's intensity grows, look for Safe Haven to lower rates much like it did last Monday.
Also, be aware and listen for Stress Test rumors.
Thursday, the government is expected to release its bank Stress Test results. However, history shows that markets often make large movements before news is ever official -- mostly on rumors. As a result, expect mortgage markets to carve out wide ranges on Tuesday and Wednesday in advance of the reports, making it very hard to "time" low mortgage rates.
And lastly, Friday brings us April's employment data. There's nothing the report can show us that we don't already know so the biggest risk here is that employment is not as bad as we all expect it to be.
If that's the case, stock markets will rally and mortgage rates will rise.
Like always, mortgage markets can change in an instant -- especially when there's outside influences on "normal" trading like we're seeing with Swine Flu and the Stress Test. If you're offered a rate and it fits your budget, consider locking right away. It may not last long.
No comments:
Post a Comment