Thank Goodness It's Friday
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Friday’s bond market has opened in positive territory following weaker than expected employment news. The stock markets are surprisingly calm with the Dow down 16 points and the Nasdaq up 2 points. The bond market is currently down 9/32 (2.42%), which should improve this morning’s mortgage rates by approximately .250 of a discount point. The bond market closed above 2.44% yesterday but this morning’s data has pushed the benchmark 10-year Treasury yield back below. It will be interesting to see where we close the day. The data certainly justifies an improvement today, so where it stands now is not a point of concern or optimism. However, if the morning strength loses steam and we close above 2.44% today or early next week, it would signal a strong likelihood of an upward trend to follow. Since mortgage rates tend to follow bond yields, this would be bad news for mortgage shoppers. However, if the rest of the day and Monday’s session drives yields lower than current levels, that upward threat should be minimized enough to take a less cautious approach towards locking a rate. Until then, I remain cautious. This morning’s key data came from the Labor Department, who released August’s Employment report at 8:30 AM ET. It revealed an unemployment rate of 6.1% as expected. That was a small improvement from July’s 6.2%. The big news came in the payroll number that showed only 142,000 new jobs were added to the economy when analysts were expecting around 220,000. This means the employment sector was softer than many had thought last month, making the data very good news for the bond and mortgage markets.
Next week brings us few reports for the markets to digest but they include an important
measurement of consumer spending. There are also a couple of Treasury auctions that have
the potential to influence mortgage rates. Nothing of relevance takes place the first part of the
week though. Look for details on next week’s activities in Sunday evening’s weekly preview.
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... Lock if my
closing was taking place between 21 and 60 days... Lock 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.
I’m always working on the weekends as well. Make today and every day the best your can.
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Jennifer Moore • Loan Officer
4458 East Cloudburst Court, Gilbert, AZ 85297
800.BAY.3703 • Bay Equity LLC • NMLS ID#76988