![Mortgage Investors Group in [Dynamic1]](../assets/images/mortgage-investors-group.svg)
MARKET COMMENT
Mortgage bond prices finished the week slightly higher which put downward pressure on rates. Rates were flat the beginning of the week amid some stock weakness. Stronger than expected data Tuesday caused rates to bump higher. New home sales printed at 592K versus the expected 560K. The strong housing data was countered by weaker than expected manufacturing data Wednesday morning. Durable goods orders fell 4%. Economists expected orders to fall 1%. The Fed kept rates unchanged as expected. The odds of a Fed rate hike before the end of the year fell to around 28%. Q2 GDP was 1.2%. Economists expected the economy to grow at a 2.4% pace.
Mortgage interest rates finished the week lower by approximately 3/8’s of a discount point.
LOOKING AHEAD
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
| Construction Spending | Monday, Aug. 1, 10:00 am, et | Down 0.4% | Low importance. An indication of economic strength. Significant weakness may lead to lower rates. |
| ISM Index | Monday, Aug. 1, 10:00 am, et | 53.3 | Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates. |
| Personal Income and Outlays | Tuesday, Aug. 2, 8:30 am, et | Up 0,2%, Up 0.1% | Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates. |
| PCE Core Inflation | Tuesday, Aug. 2, 8:30 am, et | Up 0.2% | Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve. |
| ADP Employment | Wednesday, Aug. 3, 8:30 am, et | 218K | Important. An indication of employment. Weakness may bring lower rates. |
| Weekly Jobless Claims | Thursday, Aug. 4, 8:30 am, et | 265K | Important. An indication of employment. Higher claims may result in lower rates. |
| Factory Orders | Thursday, Aug. 4, 10:00 am, et | Down 0.4% | Important. A measure of manufacturing sector strength. Weakness may lead to lower rates. |
| Employment | Friday, Aug. 5, 8:30 am, et | 4,9%, Payrolls +265K | Very important. An increase in unemployment or weakness in payrolls may bring lower rates. |
| Trade Data | Friday, Aug. 5, 8:30 am, et | $42B deficit | Important. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates. |
FUNDAMENTAL WEEK
The abundance of fundamental data this week provides a good opportunity for mortgages to improve. If the data shows weakness in the economy with little or no inflationary pressures then it is possible for mortgage bonds to rally resulting in mortgage interest rate decreases. However, if the data shows that the economy continues to rebound or any significant signs of inflation, mortgage bonds may fall pushing mortgage interest rates higher.
Mortgage interest rates remain historically favorable despite some recent volatility. Now is a great time to take advantage of these low rates.
