MIG Market Watch, August 19th, 2019

MIG Market Watch, August 19th, 2019

MIG Market Watch, August 19th, 2019


Mortgage bond prices finished the week near unchanged despite some volatile trading days. Rates were higher the first half of the week. Most of the data showed economic strength and even the core inflation reading surprised to the upside. Consumer prices rose 0.3% as expected but the core, which excludes volatile food and energy prices, rose 0.3% versus an expected 0.2% increase. Weekly jobless claims were 220K while analysts expected 215K. Retail sales were higher than expected. The Philadelphia Fed business conditions index was 16.8 versus an expected 10 reading. Q2 Productivity rose 2.3% versus 1.3%. Q2 Unit Labor Costs rose 2.4% versus a 1.6% forecasted increase. Rates fell late Thursday afternoon to counter the earlier increases. Mortgage interest rates finished the week near unchanged despite the solid data.


Economic Indicator Release Date & Time Consensus Estimate Analysis
Existing Home Sales Wednesday, Aug. 21,
10:00 am, et
5.3M Low importance. An indication of mortgage credit demand. Significant weakness may lead to lower rates.
Fed Minutes Wednesday, Aug. 21,
2:00 pm, et
None Important. Details of the last Fed meeting will be thoroughly analyzed.
Weekly Jobless Claims Thursday, Aug. 22,
8:30 am, et
218K Important. An indication of employment. Higher claims may result in lower rates.
Leading Economic Indicators Thursday, Aug. 22,
10:00 am, et
Up 0.2% Important. An indication of future economic activity. A smaller increase may lead to lower rates.
10-year Treasury TIPS Auction Thursday, Aug. 22,
1:15 pm, et
None Important. TIPS will be auctioned. Strong demand may lead to lower mortgage rates.
New Home Sales Friday, Aug. 23,
10:00 am, et
650K Important. An indication of economic strength and credit demand. Weakness may lead to lower rates.


Leading Economic Indicators

The index of leading economic indicators (LEI) is a weighted average of eleven economic variables that “lead” the business cycle. It is constructed for forecasting future aggregate economic activity. The eleven variables that make up the LEI measure workers’ hours, initial unemployment claims, new factory orders, vendor performance, contracts and orders for plant and equipment, new housing permits, changes in unfilled orders, prices of raw materials, stock prices, money supply and consumer expectations.

Each of the variables that comprise the index has a tendency to predict (or lead) economic activity. For example, new orders for manufactured goods, new orders for plant and equipment, and new building permits are all direct measures of the amount of future production being planned for the economy.

Analysts monitor the LEI in an effort to predict future economic growth. When the LEI report is up, mortgage market participants expect credit demand to increase and inflationary pressures to build. Thus, when the LEI report is rising, interest rates tend to rise as well. The LEI report is a valuable forecasting device that often correctly predicts economic turning points. The percentage change in the LEI is reported monthly and is an indication of the activity that will occur within the next three to six months. The LEI tends to turn down before peaks in the business cycle. Continuous declines are generally accepted as evidence that a recession continues.

Nine of the eleven components that make up this index are known before the release of the report, so the index is easier for economists to predict than other data releases.


Leave a comment

Mortgage Investors Group, based in Tennessee, offers residential financing in a number of states in the southeast, See MIG Service Areas. Terms and conditions to apply to home financing. We want to share with you the loan terms vary based on several characteristics and your financial profile. These include but are not limited to loan program, loan purpose, occupancy, credit history, credit score, assets, and other criteria per loan type. The repayment terms and interest rate may vary from time to time. The terms represented here are based on certain assumptions outlined below and/or noted on the loan outline page. Additional details concerning privacy, program disclosures, licensing specifics may be found at Legal Information.

MIG Loan Officers will help gather the information needed for an individual assessment to provide home financing which matches the loan characteristics with your home financing needs based on your financial profile, when you are ready to begin a full loan application. For estimates and general information before that step, the basis for which the mortgage financing information are as follows:

  • Rates are subject to change at any time.
  • Rate locks are available at current terms for 30 to 180 days based on program type, credit profile, property location, etc. which will affect the available rate and term.
  • Rate locks are available at current terms for 30 to 180 days based on program type, credit profile, property location, etc. which will affect the available rate and term.
  • Payments will vary based on program selection, current rates, property location, etc.
  • Not all programs are available in all states.
  • Some loan programs may not be available to first time home buyers.
  • Terms and conditions apply, which may include restrictions or limits per loan program.
  • Information is generally based on primary residence occupancy with no cash out when refinancing.
  • Unless otherwise stated, terms shown are estimates based in part on credit score of 700 or higher; owner occupancy, escrow account is established for taxes and insurance(s); debt-to-income ratio no higher than 43.0%; PMI applies to conventional loan programs over 80.0% LTV; VA,FHA & RD require insuring fees included in loan and/or payment; fixed rate, 30 year term.

An MIG Loan Officer is available to help with your financial details to determine which characteristics apply to your situation for a personalized look into which loan program best fits your home financing needs. Please use the Find a Loan Officer link or reach out to Mortgage Investors Group at 800-489-8910. Equal Housing Lender 1.2020