MIG Market Watch, November 22nd
Posted by : Admin
Market Comment
Mortgage bond prices finished the week higher which helped rates improve a little. Trading was volatile from day to day as inflation fears weighed heavily on the financial markets and consumers. We started the week terribly with upward pressure on rates Monday and Tuesday in response to solid data. Retail sales rose 1.7% vs 1.2%. Production rose 1.6% vs 1%. Capacity use was 76.4% vs 75.7%. NAHB housing was 83.0 vs 81.0. Weaker data mid-week and continued billion-dollar daily Fed MBS purchases helped recover the losses and more by the end of the week. Housing starts were 1.52M vs the expected 1.57M. Weekly jobless claims were 268K vs 260K. Leading Economic Indicators rose 0.9% vs 1.0%. Mortgage interest rates finished the week better by approximately 1/8 to 1/4 of a discount point.
Looking Ahead
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
| Existing Home Sales | Monday, Nov. 22, 10:00 am, et |
6.2M | Low importance. An indication of mortgage credit demand. Significant weakness may lead to lower rates. |
| Weekly Jobless Claims | Wednesday, Nov. 24, 8:30 am, et |
260K | Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates. |
| Durable Goods Orders | Wednesday, Nov. 24, 8:30 am, et |
Up 0.2% | Important. An indication of economic strength and credit demand. Weakness may lead to lower rates. |
| Q3 GDP | Wednesday, Nov. 24, 8:30 am, et |
Up 2.2% | Very important. The aggregate measure of US economic production. Weakness may lead to lower rates. |
| Personal Income and Outlays | Wednesday, Nov. 24, 8:30 am, et |
Up 0.2%, Up 0.8% |
Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates. |
| PCE Core Inflation | Wednesday, Nov. 24, 8:30 am, et |
Up 0.5% | Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates. |
| New Home Sales | Wednesday, Nov. 24, 10:00 am, et |
802K | Important. An indication of economic strength and credit demand. Weakness may lead to lower rates. |
| U of Michigan Consumer Sentiment | Wednesday, Nov. 24, 10:00 am, et |
66.9 | Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates. |
| Fed Minutes | Wednesday, Nov. 24, 2:00 pm, et |
None | Important. Details of the last Fed meeting will be thoroughly analyzed. |
Existing Home Sales
The National Association of Realtors releases existing home sales data near the end of each month. The data is derived from a sampling of MLS data across the nation. The release shows the current sales rate for existing single-family, coops, and condos. A national figure and four regional figures are provided. The housing market is a critical component of the US economy. A house is usually one of the largest assets a consumer owns. Housing usually leads to market recoveries or can signal trouble ahead. The future of the housing market remains uncertain. While the release usually is not a big market mover it still has the potential to result in some market volatility and provides a snapshot of the health of the housing industry.
