![Mortgage Investors Group in [Dynamic1]](../assets/images/mortgage-investors-group.svg)
Market Comment
Mortgage bond prices finished the week sharply higher which put downward pressure on rates. Sentiment changed to slightly favor a Fed pivot on high rates sooner rather than later. A Fed official noted that they are confident in their ability to slow the economy and get inflation back near 2%. The data showed some indications that the earlier rate hikes are now rippling through the economy. New home sales were 679K vs 720K. FHFA housing rose 0.6% vs 0.4%. Consumer confidence was 102 vs 101. Q3 GDP rose 5.2% vs 4.9%. Personal income rose 0.2% as expected. Spending also rose 0.2% as expected. Core PCE prices rose 0.2% as expected. Weekly jobless claims were 218K vs 215K. ISM index was 46.7% vs 47%. Mortgage interest rates finished the week better by approximately 3/4 of a discount point.
Looking Ahead
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
| Factory Orders | Monday, Dec. 4, 10:00 am, et |
Down 2.6% | Important. A measure of manufacturing sector strength. Weakness may lead to lower rates. |
| ADP Employment | Wednesday, Dec. 6, 8:15 am, et |
128K | Up 0.6% Moderately Important. A measure of single-family house prices. Weakness may lead to lower rates. |
| Q3 Productivity | Wednesday, Dec. 6, 8:30 am, et |
Up 4.7% | Important. A measure of output per hour. Improvement may lead to lower mortgage rates. |
| Trade Data | Wednesday, Dec. 6, 8:30 am, et |
$64B deficit | Important. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates. |
| Weekly Jobless Claims | Thursday, Dec. 7, 8:30 am, et |
223K | Important. An indication of employment. Higher claims may result in lower rates. |
| Employment | Friday, Dec. 8, 8:30 am, et |
3.9%, Payrolls +180K |
Very important. An increase in unemployment or weakness in payrolls may bring lower rates. |
| U of Michigan Consumer Sentiment | Friday, Dec. 8, 10:00 am, et |
61.8 | Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates. |
Consumer Sentiment
In the US the consumer is often seen as the driving force of the economy. A large percentage of the total economic output is for personal use. Analysts attempt to predict the future spending patterns of consumers to gauge economic activity.
The Michigan consumer sentiment index is one piece of data used to measure consumer attitudes. The index is derived from a telephone survey, which gathers information on consumer expectations of the overall economy. The preliminary report is released around the 10th of each month and then is revised throughout the remainder of the month. It is significant in that it provides a precursor into consumers’ willingness to spend in the months ahead. However, many analysts point out that willingness to spend does not always convert to actual expenditures. American consumers continue to spend despitehigh interest rates, dampening housing, and economic uncertainty. However, any jolts ahead of the holiday season could cause concern. Look for any variation from estimates in the consumer data this week to cause mortgage interest rate volatility. Signs of eroding consumer confidence could lead to improvements in mortgage interest rates. However, stronger than expected figures could spike rates higher.
