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Market
Comment
Mortgage bond
prices finished the week lower which put upward pressure on rates.
We started with slightly higher rates early Monday morning as data
showed economic strength. Retail sales rose 0.6% versus the
expected 0.4% increase. Removing automobile sales from the
data, sales rose 0.2% as expected. Housing starts and
industrial production both were stronger than expected. Weekly
jobless claims printed at 232K and continuing claims, a summation of
all receiving benefits, at 1,848K. Weekly claims were expected at
226K and continuing claims at 1,871K. The Philly Fed survey,
an indication of manufacturing activity in the all-important
Mid-Atlantic region, printed at 23.2. Traders expected a read of 21.
We ended the week worse by 1/4 to 3/8 of a discount point.
LOOKING
AHEAD
|
Economic
Indicator |
Release
Date &
Time |
Consensus
Estimate |
Analysis
|
| New Home Sales |
Tuesday,
April 24,
10:00 am, et
|
620K
|
Important. An
indication of economic strength and credit demand.
Weakness may lead to lower rates.
|
| Consumer Confidence |
Tuesday,
April 24,
10:00 am, et
|
128
|
Important. An
indication of consumers’ willingness to spend.
Weakness may lead to lower mortgage rates.
|
| Treasury Auctions Begin |
Tuesday,
April 24,
10:00 am, et
|
None
|
Important. 2Y
Notes on Tuesday, 5Y Notes on Wednesday, and 7Y Notes on
Thursday.
|
| Durable Goods Orders |
Thursday, April 26,
8:30 am, et
|
Up 2.2%
|
Important. An
indication of the demand for “big ticket” items.
Weakness may lead to lower rates.
|
| Weekly Jobless Claims |
Thursday,
April 26,
8:30 am, et
|
235K
|
Important. An
indication of employment.
Higher claims may result in lower rates.
|
| Q1 Preliminary GDP |
Friday,
April 27,
8:30 am, et
|
Up 2.9%
|
Very important.
The aggregate measure of US economic production.
Weakness may lead to lower rates.
|
| Q1 Employment Cost Index |
Friday,
April 27,
8:30 am, et
|
Up 0.6%
|
Very important. A measure of wage inflation.
Weakness may lead to lower rates.
|
| U of Michigan Consumer Sentiment |
Friday,
April 27,
10:00 am, et
|
118
|
Important. An
indication of consumers’ willingness to spend.
Weakness may lead to lower mortgage rates.
|
Consumer Confidence
The
Conference Board releases the Consumer Confidence Index on the last
Tuesday of every month. The report details the levels of
confidence individual households have in the performance of the
economy. The data is derived from a survey of 5,000 households
nationwide. The survey polls consumer opinions on current
business conditions, their jobs, their incomes, and their future
spending plans. The Conference Board is a non-profit group
that has produced the data since 1967
The
consumer confidence index is significant in that it provides a
precursor into the willingness of consumers to spend in the months
ahead. Consumers are vital to the US economy as consumer
spending is a large portion of the gross domestic product.
Manufacturers attempt to gauge consumer spending and adjust
production accordingly. The challenge that many analysts note
is the fact that a consumer’s willingness to spend does not always
convert to an actual expenditure.
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2018. All Rights Reserved. Mortgage Market
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