Daily Market Update 12/21/12

Mortgage rates edged lower Friday as investors became increasingly concerned about the chances that a deal would be reached to avoid the "fiscal cliff" before year end.  Last night, Republicans in the House failed to agree on a more modest "Plan B" approach, which President Obama and Democrats in the Senate had already dismissed as inadequate.  In economic news, November Durable Goods Orders increased by 0.7%, beating forecast.  Personal Income rose 0.6%, above the consensus of 0.4%.  The Core PCE price index, the Fed's preferred measure of inflation, was unchanged in November, and was a tame 1.5% higher than one year ago.  Consumer Sentiment fell to 72.9, below expectations.  No other key data will be released today.  After today, I will be out until January 2nd.  Have a Merry Christmas and Happy New Year!

Daily Market Update 12/20/12

Mortgage rates held steady Thursday following the release of stronger than expected economic data.  Third quarter GDP was revised higher to show economic growth of 3.1%, well above the 2.7% level reported last month.  Weekly Jobless Claims rose to 361,000, close to forecast.  Leading Indicators declined 0.2%, matching expectations.  The Philadelphia Fed Index, a survey of manufacturers in the region, rose to 8.1.  A reading of -2.0 had been expected.  Readings above zero indicate expansion in the manufacturing sector.  Existing Home Sales jumped 5.9% to 5.04 million annual units, the highest level in three years.  No other key data will be released today.

Daily Market Update 12/19/12

Mortgage rates were little changed Wednesday after inching higher over the past few days.  In economic news, November Housing Starts declined 3% to an annual rate of 861,000, below forecast.  Meanwhile, Building Permits, a leading indicator, increased 4% to the highest level since July 2008.  Investors' main focus remains the "fiscal cliff" negotiations in Washington, where progress has been slow.  Results from today's 7-year Treasury auction will be released at 1:00 PM.

Daily Market Update 12/17/12

Mortgage rates held steady Monday as weaker than expected economic data was offset by increased optimism that a deal will be reached to avoid the "fiscal cliff".  This morning, the Empire State Index declined to -8.1, well below the consensus forecast of +1.0.  Readings below zero indicate contraction in manufacturing in the region.  Results from today's 2-year Treasury auction will be released at 1:00 PM.

Daily Market Update 12/14/12

Mortgage rates were little changed Friday as investors appear to be more focused on budget negotiations than on economic data.  This morning, the November Consumer Price Index (CPI) fell 0.3%, below forecast, but was 1.8% higher than one year ago.  Core CPI, which excludes volatile food and energy components, rose 0.1% and was 1.9% higher year-over-year.  Industrial Production jumped 1.1% in November, beating expectations.  No progress was reported on fiscal cliff negotiations following last night's meeting between President Obama and House Speaker Boehner.  Greece received approval for its next round of European Union aid.  No other key data will be released today.

Daily Market Update 12/13/12

Mortgage rates inched higher Thursday following yesterday's Fed announcement and stronger than expected employment data.  On Wednesday, the Fed announced it will purchase $45 billion per month of long-term Treasury securities beginning in January 2013.  The Fed also announced it will keep the Fed Funds Rate near zero until the Unemployment Rate falls below 6.5% or inflation tops 2.5%.  In economic news, weekly Jobless Claims fell to 343,000, well below forecast.  The November Producer Price Index (PPI) fell 0.8%, below the consensus of -0.5%, and was 1.5% higher than one year ago.  Core PPI, which excludes food and energy components, increased 0.1%.  Retail Sales rose 0.3%, which was close to expectations.  Results from today's 30-year Treasury auction will be released at 1:00 PM.

Daily Market Update 12/12/12

Rates remained near record lows Wednesday ahead of this afternoon's Fed announcement, which is due out at 12:30 PM.  Fed Chairman Ben Bernanke will hold a press conference at 2:15.  The Fed's "Operation Twist" stimulus program is set to expire at the end of the year.  Under the program, the Fed sells short-term Treasurys and buys an equal amount of long-term Treasurys to help keep long term rates low.  Investors expect the Fed to announce a replacement program in which the Fed simply purchases long-term Treasurys in addition to the $40 billion of mortgage-backed securities now being purchased monthly.  In economic news, November Import Prices declined 0.9%, below the consensus forecast of -0.5%, mostly due to lower energy prices.  No other key data will be released today.

Daily Market Update 12/11/12

Mortgage rates were little changed Tuesday.  Stock prices rallied as Greece reached a debt buyback goal which was required to receive its next aid payment.  In the U.S., the Trade Deficit came in slightly lower than expected.  The Fed begins a two day meeting of the Federal Open Market Committee to discuss monetary policy.  Results from today's 3-year Treasury auction will be released at 1:00 PM.

Daily Market Update 12/10/12

Mortgage rates held steady Monday in quiet trading.  Investors are mostly looking ahead to Wednesday's Fed meeting.  No key economic data will be released today.

Daily Market Update 12/7/12

Rates inched higher Friday as stronger than expected employment data caused a decline in mortgage-backed securities.  The economy added 146,000 jobs in November, but the data from prior months was revised lower by 49,000.  The Unemployment Rate fell to 7.7%, the lowest level since December 2008, however the majority of the decline was due to workers leaving the labor force.  Average Hourly Earnings, a proxy for wage growth, rose 0.2%.  Consumer Sentiment fell sharply to 74.5, far below expectations.  The biggest economic event next week will be the two-day Fed meeting that will wrap up on Wednesday.  Investors will also remain focused on budget negotiations in Washington.  No other key data will be released today.

Daily Market Update 12/6/12

Rates remained near record lows Thursday ahead of tomorrow's Employment Report.  This morning, weekly Jobless Claims fell to 370,000, below the consensus of 380,000.  The European Central Bank (ECB) made no change in rates, as expected, but downgraded its forecast for 2013 GDP growth.  No other key data will be released today.

Daily Market Update 12/5/12

Rates were little changed Wednesday in quiet trading.  This morning, payroll firm ADP forecast private sector job growth of 118,000 in November, slightly below expectations.  Third quarter Productivity was revised higher to 2.9%, while unit labor costs fell by 1.9%.  Increased output per worker at a lower cost is good for the economy as a whole, but makes it more challenging for those seeking employment.  The Institute for Supply Management services index rose to 54.7, beating expectations.  Readings above 50.0 indicate expansion in the services sector of the economy.  Stocks were mixed.  No other key data will be released today.

Daily Market Update

Mortgage rates were unchanged Tuesday morning as no key economic data will be released today.  Investors are focusing on "fiscal cliff" negotiations in Washington, where there have been no new developments.

Daily Market Update 12/3/12

Mortgage rates held steady Monday on mixed economic data.  This morning, Construction Spending rose 1.4%, beating expectations.  The Institute for Supply Management manufacturing index fell to 49.5, short of forecast.  Readings below 50.0 indicate contraction in the manufacturing sector.  In Europe, Germany indicated that they might accept principal reductions on Greek debt and Spain formally requested funds to recapitalize its banks.  No other key data will be released today.