MyVaRefinance
  • HOME
  • ADVANTAGES OF VA LOAN
  • VA STREAMLINE REFINANCE
  • GET A QUOTE
  • BLOG
  • TESTIMONIALS

News Affecting VA Mortgage Rates and VA Home Loans

10/26/2010

0 Comments

 
  Treasuries and mortgage markets opened soft this morning on better economic data from England. The U.K. economy grew more than forecast in the third quarter and Standard & Poor’s said the nation no longer faces the risk of downgrade as pressure eases on the Bank of England to add more stimulus.  The U.K. gross domestic product rose 0.8% in the quarter through September after climbing 1.2% in the previous three months, the Office for National Statistics said in a separate report in London. The U.K. also has the top credit grades at Moody’s Investors Service and Fitch Ratings, both with a stable outlook. S&P had previously said that Britain faced a one-in-three chance of a downgrade because of its ballooning debt. The Brits are biting the bullet with huge spending cuts while here in the US we can't stop spending as the government grows like a dandelion in July.

 

At 9:00 the Case/Shiller home price index, expected up 0.2% took another dip, down 0.2%. The decline in prices may be the precursor for another run on home prices and isn't what anyone wanted to see. There was little reaction to the report as both treasuries and mortgages were already trading lower. The stock indexes were weaker and lost a few more points on the data.

 

At 9:30 the DJIA opened -56, the 10 yr note -12/32 at 2.61% above its recent high yield; mortgage prices at 9:30 -9/32 (.28 bp) frm yesterday's close on 30s, 15s -5/32 (.15 bp).

 

At 10:00 the Conference Board reported Oct consumer confidence up 50.2 frm a slightly revised 48.6 (frm 48.5).

 

Also at 10:00 the FHFA reported its home price index for Aug; up 0.4%, better than expected.

 

The Richmond Fed manufacturing index also came in better, at +5 frm -2.0 in Sept.

 

The three data points at 10:00, all better than forecasts but there has been no immediate reaction to the data in the bond market. The stock indexes however did improve but still lower on the day at 10:05.

 

Now the auctions for the week; at 1:00 Treasury will auction $35B of 2 yr notes. The demand should be good, banks like the 2 yr. Two weeks ago Treasury auctioned 3 yr, 10 yr and 30 yr notes and bonds, the demand was weak so this go-round bidders are hedging their bets by selling treasuries and also pushing mortgage prices lower.

 

Markets still consumed with next week's QE from the Fed; we will get the easing but the details remain cloudy with estimates all over. If there is a consensus it is that the Fed will announce it will purchase $500B of longer dated treasuries over a six month timeframe. The idea, to push rates lower and generate more consumer spending. Will it really? Hard to handicap how lower rates will motivate consumers, but we don't expect as much benefit as many do. Keeping interest rates low won't be easy and likely won't last long if consumer spending and the housing sector show any life as a result of the easing move.

0 Comments



Leave a Reply.

    Archives

    December 2013
    August 2013
    July 2013
    May 2013
    February 2013
    December 2012
    November 2012
    September 2012
    April 2012
    December 2011
    November 2011
    August 2011
    July 2011
    June 2011
    May 2011
    April 2011
    March 2011
    February 2011
    January 2011
    December 2010
    November 2010
    October 2010
    September 2010
    July 2010
    June 2010
    May 2010
    April 2010
    March 2010
    February 2010
    January 2010
    December 2009
    November 2009
    October 2009
    September 2009
    August 2009
    July 2009
    June 2009
    May 2009

    Categories

    All
    Home Loans
    Irrrl
    Mortgage Rate News
    Refinance
    Va Loan
    Va Loan Rates
    Va Loans
    Va Mortgage Loan
    Va Mortgage Rates
    Vamortgage Rates
    Va Refinance

    RSS Feed