Rate Lock Advisory

Sunday, February 5th

This week brings us the release of only one monthly economic report for the markets to digest in addition to a couple of Treasury auctions midweek. It starts off light with nothing scheduled tomorrow or Tuesday that are likely to affect rates. We may see some carryover weakness in bonds tomorrow, extending Friday’s post-Employment report selling that could lead to another increase in rates.

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Bonds


Market Closed

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Dow


Market Closed

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NASDAQ


Market Closed

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium


Unknown


Treasury Auctions (5,7,10,20,30 year)

The calendar begins early Wednesday afternoon with the first of two important Treasury auctions set for this week. 10-year Treasury Notes will be sold Wednesday, followed by 30-year Bonds Thursday. These sales will give us an indication of demand for long-term securities, such as mortgage-related bonds. If the sales are met with a strong demand from investors, we should see the bond market move higher during early afternoon trading those days. However, a lackluster interest from buyers, particularly international investors, will likely lead to broader bond selling. The selling in bonds would result in upward afternoon revisions to mortgage rates.

Medium


Unknown


Univ of Mich Consumer Sentiment (Prelim)

The only monthly report of the week will be February's preliminary reading to the University of Michigan's Index of Consumer Sentiment late Friday morning. This index tracks consumer willingness to spend and usually has a moderate impact on the financial markets because consumer spending is such a large part of the U.S. economy. It is currently expected to show a 65.0 reading, nearly unchanged from January's final reading of 64.9. That would indicate consumers are just as optimistic about their own financial situations as they were last month. Good news for rates would be a large decline in this reading, meaning consumers are less likely to make a large purchase.

Medium


Unknown


None

Overall, no day stands out as the most important of the week for rates with so little scheduled to influence them. The calmest day may be Tuesday unless something unexpected happens. There is a strong possibility of seeing a much calmer week for rates than the past couple. It is still prudent to watch the markets closely if still floating an interest rate and closing in the near future as they can get active without notice.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.