Wed, 25 Aug 2010 00:37:45 -0800WeeblyFri, 16 Jul 2010 10:13:03 -0800http://www.myvarefinance.net/1/post/2010/07/economic-news-affecting-va-loans-and-va-mortgage-rates.htmlConsumer prices fell for a third straight month in June thanks to lower energy costs.  The Labor Department said earlier this morning their Consumer Price Index dipped 0.1% last month after falling 0.2% in May.  Consumer prices have not declined for three consecutive months since the period from October to December 2008.  Excluding the more volatile food and energy components the "core rate" of inflation at the consumer level edged up 0.2% in June -- after posting a 0.1% gain in May.  On a year-over-year basis, the "core" inflation rate rose 0.9% -- its slowest pace since 1966.   The story here is that producers and businesses have little pricing power.  Until this dynamic changes -- inflation will remain subdued -- giving the Federal Reserve plenty of room to keep their benchmark short-term interest rates exceptionally low well into next year.  And that is good news for the prospects of sub-5.25% 30-year fixed conforming mortgage interest rates into at least the summer of 2011.   Next week's economic calendar is very thinly populated with macro-economic data.  The week will be bookended by Tuesday's release of the June Housing Starts and Building Permits figures on Tuesday and Thursday's June Existing Home Sales data.  Sandwiched in between these economic reports will be the much anticipated semi-annual congressional testimony on the health of the economy from Fed Chairman Bernanke.  He will appear on Wednesday before the Senate Banking Committee -- followed by an encore performance for the House Financial Services Committee on Thursday.  Market participants around the globe will tune-in to hear what the Fed Chairman has to say about the pace of recovery, the job growth outlook and what, if anything, the Fed intends to do should economic conditions worsen.  In my judgment current prices in the mortgage market already reflect investors' concerns about the issues Mr. Bernanke will address during this testimony.  If my assessment proves accurate, this event will exert little, if any influence on the trend trajectory of mortgage interest rates.]]>Tue, 15 Jun 2010 08:58:41 -0800http://www.myvarefinance.net/1/post/2010/06/va-mortgage-rates-and-the-news-affecting-them.htmlMortgage investors won't have any economic data to digest until the release of the May Producer Price Index figures tomorrow morning.   Between now and then -- look for mortgage interest rates to take their directional cues from trading activity in the stock markets.  Higher stock prices will tend to drag mortgage interest rates fractionally higher while lower stock prices will likely prove to be supportive of steady to perhaps lower mortgage interest rates.]]>Thu, 27 May 2010 06:32:23 -0800http://www.myvarefinance.net/1/post/2010/05/va-mortgage-rates-and-va-refinance-information-for-today.htmlGDP came in a little lower than expected but weekly new unemployment claims dropped 14k. This has put a little pressure on rates today and we may start seeing a reversal of mortgage rates for the worse coming pretty soon. ]]>Wed, 19 May 2010 17:13:54 -0800http://www.myvarefinance.net/1/post/2010/05/va-home-loans-and-va-mortgage-rates.htmlVa mortgage rates continue to hold steady at fantastic levels. Inflation reports the last couple of days came in very tame. However mortgage rates could start their climb back up over the next few weeks as bond traders look to make some profits and push yields back up.

Va home loans]]>Mon, 17 May 2010 07:29:18 -0800http://www.myvarefinance.net/1/post/2010/05/va-mortgage-rates-and-va-refinance-loans.htmlThis week is relatively calm as far as economic reports coming out that could affect mortgage rates. We should see rates stay around the same levels they have been all month. ]]>Fri, 14 May 2010 05:43:18 -0800http://www.myvarefinance.net/1/post/2010/05/yesterdays-news-affecting-va-mortgage-rates-and-va-refinance-loans.htmlUncle Sam will complete his planned three-part debt auction today with the sale of $16 billion worth of 30-year bonds.  As I write it appears this offering may not draw quite as solid a bid from the global investment community as yesterday's 10-year notes did.  Even though Uncle Sam may find it necessary to nudge the yield on these bonds up a bit in order to attract the required capital - the increase, if it occurs, will not likely be dramatic enough to cause mortgage interest rates to move notably higher as well. The number of Americans standing in line to file first-time jobless claims declined by 4,000 to a total of 444,000 during the week ended May 8th.  It was the fourth straight decline in this measure of activity in the labor sector.  The number of people collecting their second week or more of unemployment benefits edged higher while the number of people participating in the government's Emergency Unemployment Compensation program fell.  Until the total number of initial weekly jobless claims falls below 400,000 on a week-over-week basis -- this data will tend to be supportive of relatively steady mortgage interest rates.]]>Tue, 20 Apr 2010 10:43:35 -0800http://www.myvarefinance.net/1/post/2010/04/va-mortgage-rates-information.htmlDifferent day - same story.  I continue to believe the trend trajectory of mortgage interest rates will be completely dependent on trading action in the stock markets for at least the next couple of days.  It will almost certainly be an event that provides the momentum necessary to push mortgage interest rates to lower levels -- rather than anything on the balance of this month's economic calendar.   

A little counter-trend rally is now underway for the DOW and the NASDAQ will likely begin to run out of upward momentum on Wednesday or Thursday. 

Here's where things get interesting. 

If the DOW and NASDAQ rally strong enough to close above their previous respective highs of 11154 and 2517 - the upward pressure on mortgage interest rates will intensify considerably.

On the other hand, if both indexes rally but fail to take out their previous highs before turning lower - it will be a very positive development for the prospects of steady to fractionally lower rates ahead.

It is a close call - and the jury will be out on this one potentially through the end of the week.  The easiest way to make money in this business is not to lose it to start with.  Be disciplined enough to wait for forthcoming price action to signal the mortgage market's directional intentions - and avoid the temptation to take pipeline risks while simultaneously attempting to hope and wish the mortgage market into moving in favor of lower rates and higher prices. ---     ]]>Wed, 03 Mar 2010 07:03:09 -0800http://www.myvarefinance.net/1/post/2010/03/economic-news-affecting-mortgage-rates-today.htmlMBS prices are down -3/32 (FNMA 30-yr 4.5 at 101.00), which is about 1/32 higher than yesterday at this time. The 30-yr fixed FNMA required net yield (60 day) is now at 4.76% from 4.76% yesterday.  

This morning, the ADP private payrolls firm's estimate for Friday's Employment report matched expectations. The Dow is up 40 points. ISM Services will be released at 10:00 et and the Fed's Beige Book will be released at 2:00 et.  

The Mortgage Bankers Association weekly purchase activity index rose 9%, while the refinancing activity index increased by 17%. Average reported rates for the prior week fell to 4.95% from 5.03% for 30-yr fixed mortgages.]]>Thu, 11 Feb 2010 09:46:46 -0800http://www.myvarefinance.net/1/post/2010/02/va-mortgage-rate-news.htmlMortgage investors are once again taking a cautious "wait-and-see" attitude in front of the Treasury Department's $16 billion 30-year bond sale this afternoon.  Tuesday's 3-year note offering and yesterday's 10-year note sale were ugly - which does not bode well for the prospects of robust bidding at today's 30-year bond offering.  If my assessment proves accurate, look for upward pressure on mortgage interest rates to prevail for most of the day.

The Labor Department announced this morning that initial weekly jobless benefit claims for the week ended February 6th dropped 43,000 to a seasonally adjusted 440,000.  For the week ended January 23rd , enrollment in extended benefits programs increased by 13,208 to 236,041 while enrollment in the government's Emergency Unemployment Compensation program fell by 184,627 to 5.448 million.  Boiling all this statistical mumbo-jumbo down the indications are growing that the labor market is improving - at a just barely perceptible pace.  First-time filings for unemployment benefits were kept artificially low in late December and early January because of the holidays and then were biased to the high side in late January as the Labor Department caught up on their claims processing.  Mortgage investors essentially shrugged the whole thing off - reasoning that until initial weekly jobs claims stabilize around the 400,000 per week level - net month-over-month job creation will not be strong enough to exert significant upward pressure on mortgage interest rates.

The Commerce Department has postponed the release of the much anticipated January Retail Sales report until 8:30 a.m. ET tomorrow.  Both the headline figure and the component of the report excluding auto sales are expected to post modest gains after a surprising slump in December.  The slight anticipated improvement for retail sales will likely be viewed as temporary since job creation remains dismal.  If so, this event will tend to be mortgage interest rate neutral.  

]]>Tue, 26 Jan 2010 11:35:27 -0800http://www.myvarefinance.net/1/post/2010/01/va-streamline-mortgage-rate-news.htmlNervousness about the sustainability of the economic recovery combined with jitters about the health of our domestic stock markets and breaking news that Japan's sovereign debt rating may be downgraded in the face of massive deficits will likely combine to drive investors in droves to today's $44 billion two-year Treasury note auction.  This sale is part of this week's $118 billion, three-part borrowing spree by Uncle Sam.

The Treasury Department is scheduled to sell an at-record $42 billion stack of 5-year notes tomorrow and a $32 billion bundle of 7-year notes on Thursday.  An overall expectation among market participants is that all three debt offerings will be solidly bid. With all the economic and geopolitical uncertainty currently flowing through the market place - most investors with a dollar to spend in the Treasury market are likely going to invest in the shorter-end of the yield curve - rather than in a 10-year note or 30-year bond.  Well bid auctions with solid foreign investor participation will not likely influence the direction of mortgage interest rates much one way or the other.  In the off chance any one of these three auctions is deemed to have been poorly bid - defined by a higher yield and lower price - you can bet mortgage investors will likely push their rates higher as well.   I post the results of today's 2-year note auction on the website as soon as possible after the final gavel falls at 1:00 p.m. ET.

The fact that the Fed will be holding a two-day monetary policy meeting right in the middle of Uncle Sam's borrowing spree is not helping lower trader anxiety levels.  Mortgage investors are fretting about what the Fed may say about it's exist strategy from its emergency market measures.  Current speculation that Wednesday's post-meeting statement from policymakers will sound sharply threatening to the prospects of steady to lower mortgage interest rates is, in my opinion, way over done.  The Fed has essentially two responsibilities; promoting full employment and keeping inflation in check.  The high jobless rate means the Fed is far from accomplishing its first goal while extremely benign inflation pressure are helping them achieve their second objective.  Against this backdrop it is highly likely the Fed's post-meeting statement on Wednesday afternoon will include only minor changes to the December statement but will focus on the headwinds still facing the economy as it struggles to recover from the worst recession since World War II.  At the end of the day - the probabilities are high that this event will exert little, if any significant influence on the trend trajectory of mortgage interest rates. 

This week's Federal Open Market Committee meeting is at bit more dramatic than normal due to the fact that Fed Chairman Ben Bernanke's path to a second term has taken an unexpected, and potentially dangerous turn for the worse.  If Bernanke is not confirmed before his current term expires on January 31st - the effect on mortgage interest rates will likely be swift - and unpleasant.  A Congressional refusal to give Bernanke a second term will likely be perceived by credit market participants as politicizing decisions on monetary policy, a condition sure to negatively impact the creditability of the central bank with domestic and foreign investors alike.

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