April 14th, 2017 5:30 PM by T. Fanning
Last Updated: 4/14/17The bond market is closed today in observance of the Good Friday holiday, as are the stock markets. All will reopen Monday morning for regular trading hours. If your lender is open for business today, they likely will be using Thursday's early afternoon pricing or not accepting rate locks until Monday morning. It is worth noting though that strength before the early close Thursday pushed the benchmark 10-year Treasury Note yield below 2.25%. This was an important point of resistance that if holds, will alter the longer-term outlook for bonds and mortgage rates.Despite the holiday, there were two important economic reports posted this morning. The Commerce Department posted March's Retail Sales data at 8:30 AM ET, announcing a 0.2% decline in retail-level sales. That was weaker than the 0.1% that was forecasted. In addition, a secondary reading that tracks sales excluding more volatile and costly auto transactions showed no change when analysts were predicting a 0.2% rise. Both readings are good news for bonds and mortgage pricing as consumer spending makes up over two-thirds of the U.S. economy. Therefore, weaker spending data points towards softer economic growth that makes bonds more attractive to investors.Also posted early this morning was March's Consumer Price Index (CPI). It showed 0.3% decline in the overall reading and a 0.1% decline in the more important core data. Both of these readings were well below expectations of no change and up 0.2% respectively. This means inflationary pressures at the consumer level of the economy were much softer than many had thought. That is very good news for bonds and mortgage rates because bonds tend to thrive in weaker economic conditions with low inflation. It also could affect the Fed's timetable for raising key short-term interest rates.This morning's data is clearly favorable news for the bond market and both reports are important enough to have a noticeable impact on bonds and mortgage rates. Unfortunately, we likely will not see a reaction until Monday morning because of the holiday. I believe that this type of news should have caused a decent sized improvement in rates, but we will have to wait for Monday to see just how much. The good news is that unless something unexpected happens over the weekend, we should have a rate improvement coming to start the new week.Next week isn't too busy in terms of the number of economic reports scheduled to be posted. There appears to be a couple of housing releases coming along with the Fed beige Book and an industrial manufacturing report. None of them are set for Monday though. Look for details on next week's calendar in Sunday evening's weekly preview.If I were considering financing/refinancing a home, I would....Lock if my closing were taking place within 7 days...Lock if my closing were taking place between 8 and 20 days...Float if my closing were taking place between 21 and 60 days...Float if my closing were taking place over 60 days from now...This is only my opinion of what I would do if I was financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.**http://www.hlmcolorado.com/DailyRateAdvisory
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