Mortgage Rates Down Big, But Lagging Other Indicators – Mortgage News Daily
Mortgage Rates Down Big, But Lagging Other Indicators Mortgage News Daily
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Here’s an Argument for the Wait to Buy a Home Crowd
A lot of folks have pondered the buy now or buy later question when it comes to a home purchase. The waiters are waiting for home prices to fall, knowing affordability is historically low. The non-waiters either canât wait or donât want to wait because they expect competition to heat up once things turn around.… Read More »Here’s an Argument for the Wait to Buy a Home Crowd
The post Here’s an Argument for the Wait to Buy a Home Crowd appeared first on The Truth About Mortgage.
February jobs report â reactions pour in
The upshot: Higher interest rates are in the offing, he said. “Fed chair [Jerome] Powell communicated earlier this week that incoming data on the U.S. economy continues to show strength and that a higher level of interest rates, and potentially for a longer period of time, is likely needed to cool inflation,” the economist said … [Read more…]
Biggest Rally For Short-Term Rates in Decades, Why?
Despite the announcement of a Fed/Treasury/FDIC backstop for SVB and Signature Bank, financial markets are trading as if current events imply a sea change for economic momentum, inflation, and the Fed rate hike trajectory. It’s pretty much that simple. What’s not so simple is determining whether or not that trading will prove to be justified by changes in consumer behavior. Also complicated will be the task of reacting to economic data for the month of February when the sea change wasn’t even an idea until last week.
Breaking Down the Big Move in Rates and Considering The Road Ahead
Breaking Down the Big Move in Rates and Considering The Road Ahead The 2nd and 3rd largest bank failures in history have happened over the past 3 days. Markets reacted in a logical direction. If anything, the drop in rates was made bigger by the fact that the market is searching for evidence that it’s time for the Fed to dial back its hawkish rate policies. That’s what today ended up being mostly about: the market betting on a MUCH lower rate hike profile in the coming months (and rate CUTS starting in a few short months). Between Tuesday’s CPI data and next week’s Fed announcement we’ll have the data we need and the requisite amount of cooling-off time to have a much better sense of what the road ahead looks like. Today’s video discusses several of the options, and much more. Econ Data / Events No significant econ data Market Movement Recap 08:59 AM Supermassive bond rally overnight, led by short-term rates. 2yr down more than 50bps at times. 10yr currently down 25bps at 3.45. MBS up just over 3/4ths of a point. 12:36 PM Strongest levels of the day at 11am and selling off a bit since then. 5.5 coupons still up 3/4ths on the day, but down half a point from highs. 10yr yield up 11bps from lows and now near highs of day at 3.524, but still down 18bps overall. 04:07 PM MBS now up “only” 22 ticks (.69) and 10yr down “only” 16bps at 3.545. Both are quite a bit weaker on the day, but the pace of losses has been gradual
Mortgage Rates vs. Bank Failures
Youâve heard about, you know about it. Last week, Silicon Valley Bank was the target of a bank run, prompting the FDIC to take over the troubled company on March 10th. It was the first bank failure since October 2020, and was quickly followed by another failure, NYC-based Signature Bank. That prompted the Federal Reserve… Read More »Mortgage Rates vs. Bank Failures
The post Mortgage Rates vs. Bank Failures appeared first on The Truth About Mortgage.
How the run on banks is affecting the mortgage market
The collapse of Silicon Valley Bank and Signature may trigger lower mortgage rates, but it will likely increase scrutiny on IMBs and their risk management strategies.
Smart Money: How COVID-19 Changed Our Finances â and Our Advice
NerdWallet writers discuss how COVID-19 changed the way we manage and talk about money in this roundtable episode of the Smart Money podcast.
How Do Banks Make Money? Income & Profit Creation Explained
Discover how commercial banks make money. From loans to securities, interchange fees, and customer fees we break down the details of how banks make their money.
Wild Ride Before and After Jobs Report Due to SVB
The most notable development on jobs day has stunningly turned out to be the trading that came before the jobs report in the overnight session. Bonds embarked on a fairly big rally, ostensibly due to Silicon Valley Bank news. 10yr yields were roughly 10 bps lower before NFP came in at 311k vs 205k f’cast. Anyone could be forgiven for think such a number meant trouble for bonds, but bonds paradoxically rallied (with an eye on higher unemployment and lower wages). After a brief correction, the gains continued all morning, ultimately adding up to the biggest rally day since November 10th. But how much–if any–of this is due to the jobs report? That’s a tough call, but only inasmuch as deciding if we want to give the jobs report ANY credit. It may deserve anywhere between 5-20%, but the market is clearly trading the SVB news. One of the clearest indications of that comes from the stock market. The prevailing trend in stocks and bonds has been for both sides of the market to rally and sell together based on shifts in Fed rate hike expectations. This makes for the classic mirror image trading pattern we sometimes refer to as the “Fed accommodation trade.” Over the past 2 days, however, as the SVB news intensified, markets shifted back to the old school “risk-on/risk-off” trade. That doesn’t mean this move isn’t “real.” To be sure, Fed Funds Futures are reacting as well. That said, inflation is still the big picture driver of rate momentum. SVB news only matters in the big picture if it kicks off a mini-wave of bank failures that somehow manage to impact inflation or otherwise serve as a canary in a coal mine for a harder economic landing. Markets may be braced for that possibility today, but they’ll forget all about it if next week’s CPI comes in hot. Conversely, if CPI comes in cooler, it could add to the momentum. Bottom line: we’re still data dependent, but now with a nice little boost to prevailing levels.