Three things that could impact rates this week

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Published Date 6/24/2024

Today's Mortgage Rate Summary

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.

Rates Currently Trending: Neutral

Mortgage rates are moving sideways today. The MBS market improved by +5 bps last week. This was not enough to decrease mortgage rates or fees. The market experienced moderate volatility last week.

This week's Rate Forecast: Neutral

Three Things: These are the three areas that have the greatest ability to impact rates this week. 1) Inflation, 2) The Fed and 3) The state of the Consumer.

1) Inflation: We get the Fed's preferred key measure of inflation, Core PCE on Friday. Both the Headline and Core readings are expected to move lower on a YOY basis which could give the Fed more cover for one rate cut this year. The market speculation will hinge on if the readings are low enough for the Fed to make a move in September. If the readings are higher than expectations, then expectations for a Fed move will be pushed back.

2) The Fed: We will hear from many Fed Speakers this week the markets will also been keen on learning the results of the latest round of Bank Stress Tests:

06/24 Waller, Daly

06/25 Bowman, Cook

06/26 Bank Stress Tests

06/28 Barkin, Bowman

3) The state of the Consumer: We get both Consumer Confidence and Consumer Sentiment this week. Tuesday's Consumer Confidence and Inflation Expectations will get more weight.

Treasury Auction: Here is this week's Treasury auction schedule:

06/25 2 year note

06/26 5 year note

06/27 7 year note

This week's Potential Rate Volatility: High

This morning markets are moving in a very narrow channel. Volatility has started low but will increase dramatically later this week with PCE.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

Source: TBWS

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

Millenium Home Mortgage, LLC NMLS # 51519 Licensed by the NJ Department of Banking and Insurance, CT Mortgage Banker 1st and 2nd Mortgages Licensed as MHM Home Mortgage, Licensed by the Pennsylvania Department of Banking. All interest rates, fees and programs are subject to change without notice. THIS ENTIRE SITE IS NOT INTENDED AS A SOLICITATION FOR MORTGAGE LOAN CUSTOMERS IN NEW YORK, PENNSYLVANIA, OR CONNECTICUT.