Rate Lock Advisory

Sunday, May 5th

There is very little economic data scheduled this week that is expected to influence mortgage rates. With only one monthly release scheduled, traders will be relying on a couple of Treasury auctions and a large number of Fed speaking appearances for market direction. We are still in earnings season, meaning stocks may also see some volatility that can indirectly affect bond trading and mortgage pricing.

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Bonds


Market Closed

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Dow


Market Closed

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NASDAQ


Market Closed

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium


Unknown


Fed Talk

We only have Fed speeches to watch the first few days. In fact, there is at least one speech scheduled each day of the week. The current calendar doesn’t show Chairman Powell making one, but with so little else coming this week, their words may have a stronger impact on trading than normal even if there are no major surprises.

Medium


Unknown


Treasury Auctions (5,7,10,20,30 year)

Beginning this week’s activities will be the first of the two relevant Treasury auctions. 10-year Notes will be auctioned Wednesday while 30-year Bonds will be sold Thursday with results of each sale posted at 1:00 PM ET on auction day. If these sales are met with a strong demand from investors, we could see bond prices rise enough during afternoon trading. causing downward revisions to mortgage rates. However, lackluster bidding in the sales, meaning longer-term securities are losing their appeal, could lead to higher mortgage pricing during afternoon trading.

Medium


Unknown


Univ of Mich Consumer Sentiment (Prelim)

May's preliminary reading to the University of Michigan's Index of Consumer Sentiment will close out this week’s calendar at 10:00 AM ET Friday. This index measures consumer willingness to spend, which relates to consumer spending. If consumers are more confident in their own financial situations, they are more apt to make large purchases in the near future. This report usually has a moderate impact on the financial markets though, because it is not exactly factual data. It is expected to show a reading of 76.5, down from April's final reading of 77.2, indicating consumers are a little less confident than last month. If it shows a larger decline in confidence, bond prices could rise and mortgage rates may move slightly lower because waning confidence usually translates into softer consumer spending that restricts overall economic growth.

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Unknown


none

Overall, Wednesday is the best candidate for most active day for rates due to the 10-year Treasury Note auction and several Fed speeches scheduled. The calmest day may be Tuesday unless something unexpected happens. We should see a relatively calm week compared to others recently, but the markets can still get active without notice. Therefore, proceed cautiously if still floating an interest rate and closing in the near future.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.


Brian Zwick

4676 Lakeview Ave Ste 205
Yorba Linda, CA 92886