Mortgage Commentary on Massachusetts Mortgage Rate Trends
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Wednesday’s bond market has opened flat again as it appears what was said in last night’s State of the Union is of little interest to the bond market. The stock markets are currently mixed with the Dow down 68 points but the Nasdaq up 10 points. The bond market is up 1/32, which should keep this morning’s Massachusetts mortgage rates close to yesterday’s levels.
There is no relevant economic data scheduled for release this morning. The big news will come later today when the FOMC meeting adjourns at 12:30 PM ET and again after Chairman Bernanke’s press conference at 2:15 PM ET. It is common to see some movement in the markets and Massachusetts mortgage rates ahead of events like these as traders look to protect themselves or position themselves based on the latest rumors.
Today’s Fed events will also give us their forecast for key short-term interest rates, allowing the markets insight to the Fed’s thinking for the next couple years. This is a first and could very well be a significant market mover if even the smallest surprise is in those forecasts. The general consensus is that the Fed will leave the Federal Funds rate at its current level of nearly 0% until sometime in 2013. A shorter or longer timetable will likely fuel a sizable reaction in the markets and Massachusetts mortgage rates this afternoon.
Also today is the first of two Treasury auctions that may influence Massachusetts mortgage pricing. 5-year Notes will be sold today while 7-year Notes go to sale tomorrow. If the sales are met with a strong demand from investors, the broader bond market should thrive, possibly leading to slightly lower Massachusetts mortgage rates. On the other hand, weakness in the auctions could fuel bond selling and an upward revision to rates. The results of the sale will be posted at 1:00 PM ET (between FOMC adjournment and the press conference).
There is plenty of economic data on tap tomorrow, including Durable Goods Orders, weekly unemployment figures, New Home Sales and Leading Economic Indicators (LEI). However, we will address them in this afternoon’s updated report. We will post a revised report shortly after the Fed press conference so that the markets and Massachusetts mortgage rates have an opportunity to react the afternoon’s events.
Lock or Float Advice based on Massachusetts Mortgage Rate Trends
If I were considering purchasing or refinancing a home and predicting likely Massachusetts mortgage rates, I would…
Lock if my closing was taking place within 7 days…
Float if my closing was taking place between 8 and 20 days…
Float 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 a general opinion of what I would do if I were considering whether to lock or float based on Massachusetts mortgage rate trends. Your individual situation may be different.
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