Initial Weekly Jobless Claims remain low

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Published Date 6/27/2024

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 getting support today. The MBS market worsened by -18 bps yesterday. This was probably not enough to increase mortgage rates or fees. The market experienced moderate volatility yesterday.

Today's Rate Forecast: Neutral

Jobs: Initial Weekly Jobless Claims were better than expected, 233K versus estimates of 236K. The four week moving average moved up to 236K. Continuing Claims were worse (higher) than expected at 1.839M versus estimates of 1.820M.

Manufacturing: Headline May Durable Goods Orders beat out estimates, 0.1% versus estimates of -0.1% but the rest of the data was weak. Durable Goods ex Transportation contracted by -0.1% versus estimates of +0.2%. The closely watched Non Defense/Ex Aircraft was down -0.6% versus estimates of 0.2%.

Report Card: The 1st QTR GDP was revised again (this is the third time this data point has been released), this time to 1.4% versus estimates of 1.4%. It was originally released at 1.6% and had been revised down to 1.3%.

Housing: We get the May Pending Home Sales Index at 10 am, it is expected to improve by 2.5%. The report came in at -2.1%.

Treasury Auction: We have a 7 year note auction today at 1 pm.

Today's Potential Rate Volatility: Neutral

This morning markets are getting a small boost. Volatility has started at moderate levels with markets still waiting on inflation data.

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

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