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Weekly Mortgage Rate Update (July 10th, 2017) Hagerstown, MD Real Estate

Rates at a Glance

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market.  This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events.  When MBS pricing goes up, mortgage rates or pricing generally goes down.  When they fall, mortgage pricing goes up.  Tracking these securities real-time is critical.  For more information about the rate market, contact me directly.  I’m among few mortgage professionals who have access to live trading screens during market hours.

Rates Currently Trending: Neutral

Mortgage rates are trending sideways this morning. Last week the MBS market worsened by -26 bps. This was enough to worsen mortgage rates or fees. Mortgage rates were relatively volatile last week.

This Week's Rate Forecast: Neutral

Three Things: These are the three things that have the greatest ability to impact mortgage rates this week. 1) Fed, 2) Geopolitical and 3) Domestic.

1) Fed: Fed Chair Janet Yellen will give her semiannual testimony before the Senate on Wednesday and the House on Thursday. Her prepared statement and responses to the seemingly unending wave of inane questions from elected officials could have a significant impact on mortgage rates. We also hear from several other Fed officials.

  • 07/10 John Williams
  • 07/11 Lael Brainard and Neel Kashkari
  • 07/12 Janet Yellen and Esther George and the release of the Beige Book.
  • 07/13 Janet Yellen and Charles Evans
  • 07/14 Robert Kaplan

2) Geopolitical: The market is extremely interested in any new developments or progress with health care report in the Senate as well as Tax reform, which our Treasury Secretary says will still get done this year. We also are scheduled to increase our debt ceiling and have plenty of geopolitical concerns (North Korea, etc) across the pond that will influence bond trades.

3) Domestic: We have a lot of economic data that will hit this week with Retail Sales getting a lot of attention. But it will be the Producer Price and Consumer Price Indexes that will get the most attention.

Treasury Auctions This Week:

  • 07/11 3 year note
  • 07/12 10 year note
  • 07/13 30 year bond – most important

This Week's Potential Volatility: Average

We expect mortgage rates to trade in a fairly narrow range until Wednesdaywhen Janet Yellen gives her testimony in front of the Senate. For the rest of the week we could see some mortgage rate volatility, particularly when you throw in CPI numbers on Friday.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

Your weekly mortgage rate update is provided by:

Maximized Mortgage Solutions