MARKET COMMENT
Mortgage bond prices finished the week higher which helped rates improve a little. Rates were pressured higher early in the week tied to stronger data. New home sales printed at 621K versus the expected 572K. Trading reversed Wednesday as stock weakness emerged, and the DOW closed down 133 points. That continued into Thursday as the DOW closed down 200 points. Weekly jobless claims were in line with estimates. Fourth quarter 2018 labor costs rose 2% versus the expected 1.6% increase. The Bureau of Labor Statistics reported jobs increased 20K and the unemployment rate at 3.8%. Analysts expected the creation of 178K jobs and unemployment at 3.8%. Mortgage interest rates finished the week with discount points better by 1/4.
LOOKING AHEAD
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
| 3-year Treasury Note Auction | Monday, March 11, 1:15 pm, et | None | Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates. |
| Consumer Price Index | Tuesday, March 12, 8:30 am, et | Up 0.1%, Core up 0.2% | Important. A measure of inflation at the consumer level. Weaker figures may lead to lower rates. |
| 10-year Treasury Note Auction | Tuesday, March 12, 1:15 pm, et | None | Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates. |
| Producer Price Index | Wednesday, March 13, 8:30 am, et | Up 0.1%, Core up 0.3% | Important. An indication of inflationary pressures at the producer level. Weaker figures may lead to lower rates. |
| 30-year Treasury Bond Auction | Wednesday, March 13, 1:15 pm, et | None | Important. Bonds will be auctioned. Strong demand may lead to lower mortgage rates. |
| Weekly Jobless Claims | Thursday, March 14, 8:30 am, et | 227K | Important. An indication of employment. Higher claims may result in lower rates. |
| Industrial Production | Friday, March 15, 9:15 am, et | Down 0.5% | Important. A measure of manufacturing sector strength. A lower than expected increase may lead to lower rates. |
| Capacity Utilization | Friday, March 15, 9:15 am, et | 78.3% | Important. A figure above 85% is viewed as inflationary. Weaker figure may lead to lower rates. |
| U of Michigan Consumer Sentiment | Friday, March 15, 10:00 am, et | 93.8 | Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates. |
MANAGING RISKS
To make wise lock decisions everyone needs to be aware of two primary risks. Those are price and event risks. Price risk is simply where the market stands since regularly scheduled morning pricing. Event risk is the economic data that is heading our way. Most rate changes come in response to an economic release. A borrower that chooses to float in front of economic events takes a very big financial risk.
Floating overnight when there is little data and positive movement since pricing is a calculated risk. Floating with losses ahead of a significant release is a gamble. Most borrowers would be wise to take advantage of current rates and then refinance in the future if rates fall.
