Translate:

EN

MIG Market Watch, March 9th, 2020

MIG Market Watch, March 9th, 2020


MIG Market Watch, March 9th, 2020

MARKET COMMENT
Mortgage bond prices finished the week higher which put downward pressure on rates. Most of the improvements came Monday as stocks remained very volatile. Stocks rebounded a bit in response to the Super Tuesday election results but then resumed the selloff Thursday and Friday. Treasuries outperformed MBSs but both saw price increases and rate decreases. The Fed stepped in with a surprise rate cut (see below.) ADP employment was 183K versus the expected 170K. Factory orders fell 0.5%. Productivity was 1.2% vs 1.4%. Unemployment was 3.5%. Analysts looked for a reading of 3.6%. Payrolls surged higher with a reading of 273K vs 175K. Much of the data was dismissed as “dated” as coronavirus fears increased and global growth estimates were revised significantly lower. Mortgage interest rates finished the week better by 1/4 to 3/8 of a discount point.

LOOKING AHEAD

Economic Indicator Release Date & Time Consensus Estimate Analysis
3-year Treasury Note Auction Tuesday, March 10,
1:15 pm, et
None Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Consumer Price Index Wednesday, March 11,
8:30 am, et
Up 0.2%,
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 Wednesday, March 11,
1:15 pm, et
None Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Weekly Jobless Claims Thursday, March 12,
8:30 am, et
208K Important. An indication of employment. Higher claims may result in lower rates.
Producer Price Index Thursday, March 12,
8:30 am, et
Up 0.3%,
Core up 0.2%
Important. An indication of inflationary pressures at the producer level. Weaker figures may lead to lower rates.
30-year Treasury Bond Auction Thursday, March 12,
1:15 pm, et
None Important. Bonds will be auctioned. Strong demand may lead to lower mortgage rates.
U of Michigan Consumer Sentiment Friday, March 13,
10:00 am, et
97 Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.

FED SURPRISE
The Fed made a surprise rate cut of 50 basis points last Tuesday to combat the economic drag of the coronavirus outbreak. It was not a complete surprise as the US Administration has been demanding the Fed act and analysts believed they would soon. However, the timing and magnitude of the cut caught many off guard. Most predicted a move at the mid-March meeting and a lot thought they would start slowly with a 25 basis point cut. Recent massive stock losses elevated investor and consumer fears. It appears the Fed believed a significant policy move was needed. The Fed stated: “The fundamentals of the U.S. economy remain strong. However, the coronavirus poses evolving risks to economic activity. In light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate by 1/2 percentage point, to 1 to 1 1/4 percent. The Committee is closely monitoring developments and their implications for the economic outlook and will use its tools and act as appropriate to support the economy.”

Mortgage-backed securities benefited from the cut in the short-term as prices rose and rates fell in response to the cut late Tuesday morning. The 10Y Treasury rate hit all-time lows. The MBS reaction though was within a narrow margin and not as strong as the Treasury movements.

Share

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 migonline.com 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