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MIG Market Watch, April 22nd, 2019

MIG Market Watch, April 22nd, 2019


MIG Market Watch, April 22nd, 2019

MARKET COMMENT
Mortgage bond prices finished the week lower which put a little upward pressure on rates.  Rates were negative Monday morning but basically flat the remainder of the week.  The NAHB Housing Market Index printed at 63 as expected.  The trade balance was in line with estimates.  Retail sales data was solid (read below.)  Weekly jobless claims were lower than expected at 192K.  Analysts looked for a reading of 208K.  Continuing claims were also better than expected with a reading of 1653K versus 1713K.  The Philadelphia Fed business conditions index countered that data with a sign of weakness.  A reading of 8.5 versus the expected 11 mark was not terrible but caused some concern.  Mortgage interest rates finished the week worse by 1/8 of a discount point.

LOOKING AHEAD

Economic Indicator Release Date & Time Consensus Estimate Analysis
Existing Home Sales Monday, April 22,
10:00 am, et
5.8M Low importance.  An indication of mortgage credit demand.  Significant weakness may lead to lower rates.
FHFA House Price Index Tuesday, April 23,
9:00 am, et
Up 0.8% Moderately Important.  A measure of single family house prices.  Weakness may lead to lower rates.
New Home Sales Tuesday, April 23,
10:00 am, et
670K Important.  An indication of economic strength and credit demand.  Weakness may lead to lower rates.
2-year Treasury Note Auction Tuesday, April 23,
1:15 pm, et
None Important.  Notes will be auctioned.  Strong demand may lead to lower mortgage rates.
5-year Treasury Note Auction Wednesday, April 24,
1:15 pm, et
None Important.  Notes will be auctioned.  Strong demand may lead to lower mortgage rates.
Weekly Jobless Claims Thursday, April 25,
8:30 am, et
190K Important.  An indication of employment.   Higher claims may result in lower rates.
Durable Goods Orders Thursday, April 25,
8:30 am, et
Up 0.2% Important.  An indication of the demand for “big ticket” items.  Weakness may lead to lower rates.
7-year Treasury Note Auction Thursday, April 25,
1:15 pm, et
None Important.  Notes will be auctioned.  Strong demand may lead to lower mortgage rates.
Q1 GDP Friday, April 26,
8:30 am, et
Up 2.1% Very important.  The aggregate measure of US economic production.  Weakness may lead to lower rates.


Sales Rebound

Retail sales, an indication of the strength of the consumer, rose 1.6%. Excluding automobiles sales rose 1.2%. That data was stronger than expected.  Forecasts predicted a 0.9% increase in the headline figure and 0.7% ex-autos increase.  Sales plunged back in February and many were worried about the strength of the economy.  The recent strong retail sales report bodes well for a strong Q1 GDP release this week.  Sixty-seven percent of the economy is driven by consumer spending.  Be cautious heading into the economic release this week.

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