July 21, 2008
The Economic Calendar is a busy one this week, but there is not one piece of data that is expected to move the market. If you wrote a contract over the weekend you may be asking, should I float or should I lock? This information should help you make that decision:
- Today: we had LEI which was in line with expectations
- Tuesday 22nd Treasury Auction of 20 yr indexed securities
- Wednesday 23rd, Treasure Auctions 2 year notes
- Wed, The Fed release the Beige Book, it is a compilation of data from across the country expected to show sluggish growth, it is not very likely that there will be any surprises in this report
- Thursday 24th: Initial Jobless claims, the summer months are usually discounted by traders, if the number comes in UP 9,000 or more that will be good news for rates... less than 9k could be bad
- Thursday: Existing home sales Expected down 1.2%.... Described as a "yawner" it will only move rates if the month over month gain is significant.
- Thursday: yet another Treasury auction of 5 yr notes. The auctions are expected to be well received which will be supportive of steady Mortgage rates
- Friday 25th: June Durable goods, expected down .3%... the down is anticipated due to weakness in transportation orders, not likely to impact rates
- Friday: June New Home Sales, expected down 1.8% Same deal as Existing home sales... if significantly stronger than anticipated it may move rates, but probably will not be an issue.
Even with this Laundry list of data it will be the trading action in the Equities markets (stocks) and Oil prices (along with any comments from FED governors) that the market will be looking at. We will need to see steady to lower stock an Oil prices, along with a lack of talk about inflation from the FED for us to see a significant move down in rates. But ONE bad day in the Stock market can cause a flight to quality and artificially bring rates down.
It may be a bumpy week, but a blind one at the same time. The safe gamble would be to lock, but my gut says we may improve slightly after the run up in rates last week. The market has a tendency to have knee jerk reactions UP and slow settling back down, So you also have to factor in the amount of time you have till you close in making the decision to lock in your loan.
Have a wonderful week!
Rob
Robert Rauf
(732)740-0175
Rob, great information. Most of it was so over my head I had to shade my eyes to see it!! My eyes cross when I read this kind of stuff, unfortunately!
But Susan, that was in english! If you take economics for the common sense approach it will make sense, (most of the time!) at least it made sense to me when I took Economics 101, and thats why I majored in it!