Rate Lock Advisory

Wednesday, April 8th

Wednesday’s bond market has opened in negative territory again, but not enough to prevent an improvement in mortgage pricing. Stocks are in positive ground after giving back all of yesterday’s early gains to close with a loss. The Dow is currently up 43 points while the Nasdaq is up 20 points. The bond market is down 9/32 (0.75%). However, strength in mortgage bonds late yesterday should allow this morning’s rates to be a little lower than yesterday’s early pricing.



30 yr - 0.75%







Mortgage Rate Trend

Trailing 90 Days - National Average

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

Indexes Affecting Rate Lock



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

Today’s only potentially relevant events will take place during afternoon trading. The 10-year Treasury Note sale is today with results being posted at 1:00 PM ET. If investor demand for the securities was strong, the bond market could rally after those results are announced. On the other hand, auctions met with a lackluster interest often cause enough of a move in bonds to create an upward revision in mortgage pricing.



Federal Open Market Committee (FOMC) Minutes

Also set for this afternoon but at 2:00 PM ET is the release of the minutes from the March 15th FOMC meeting. Market participants will be looking at them closely as they give us insight to the Fed's current thought process and individual Fed member opinions about how bad the economy will get during this pandemic. Any surprises in the release could cause afternoon volatility in the markets and possible changes in mortgage rates mid-afternoon.



Weekly Unemployment Claims (every Thursday)

Weekly unemployment figures will be released at 8:30 AM ET tomorrow morning. Up until the past three weeks, this release drew little attention because it is only a weekly snapshot. That changed last month when it became the best and freshest indicator of how badly the coronavirus reaction was affecting the employment sector. Last week’s update showed that 6.6 million new claims for unemployment benefits were filed the previous week. Look for another big number, but forecasts range from 3 million to 8 million new filings. A high number of new claims is good news for bonds and mortgage pricing.



Producer Price Index (PPI)

March's Producer Price Index (PPI) will also be posted early tomorrow morning. It measures inflationary pressures at the producer level of the economy. If inflation is rapidly rising, bonds become less appealing to investors, leading to bond selling and higher mortgage rates. However, inflation isn’t a concern in the current economic situation. Accordingly, unless it shows a huge surprise it likely will not have a noticeable influence on mortgage rates.



Fed Talk

Fed Chairman Powell is speaking via webcast tomorrow morning for the Brookings Institute in Washington D.C. He is scheduled to speak at 10:00 AM ET regarding the economic impact of the coronavirus and the Fed’s response to it. He will take questions after, so look for this to possibly be a driving force in tomorrow’s morning trading also.



Holiday Schedule

The bond market will close at 2:00 PM ET tomorrow ahead of the Good Friday holiday, reopening Monday morning. Stocks are set for a full day of trading tomorrow but will be closed Friday.

Float / Lock Recommendation

If I were considering financing/refinancing a home, 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 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.