Market Overview, Mortgage News, Weekly Review

What’s News for Mortgage Rates This Week: January 10th

January 10, 2011 by · 1 Comment 

This past Friday, we learned that the labor market continues to improve. According to the Labor Department, 103,000 jobs were created in December and private job growth was at 113,000. Although job growth missed expectations, upward revisions to the prior two months showed 70,000 more jobs than previously reported.

The most noteworthy part of the Jobs Report was the decline in the unemployment rate to 9.4 percent.

What's News for Mortgage Rates This Week January 10th by James Barath

Mortgage bonds have started the week in positive territory with help from the Fed’s scheduled purchase of $7 billion to $9 billion treasury notes later this afternoon and an additional $7 billion to $9 billion on Tuesday.

Even though it may be cold outside, both the financial market and mortgage bond market will heat up toward the end of the week with the following key economic reports set to be released.

  • Get ready for a double dose of inflation news with Thursday’s Producer Price Index Report, which highlights inflation at the wholesale level, and Friday’s Consumer Price Index Report, measuring inflation for consumers… that’s you and me! Remember: The Fed is intent on creating inflation, which is unfriendly to home loan rates, and signs of inflation from these reports could be unfavorable for rates.
  • On Thursday, all eyes will be on the weekly Initial and Continuing Jobless Claims Report. Last week, Initial Jobless Claims came in at 409,000, part of an encouraging trend that shows claims are getting closer to that important 400,000 mark, which represents a sign of continuing improvement in the labor market.
  • Lastly, Friday will see the release of the Retails Sales Report for December, as well as the Consumer Sentiment Index. Will they show that the Fed’s plans to stimulate the economy are working?

The bottom line for right now is that the familiar chant “Don’t Fight the Fed” continues to ring true. The Fed is intent on creating inflation, lowering the unemployment rate and raising Stock prices…and they have already been somewhat successful. Quantitative Easing 2 will likely keep coming until the employment picture improves significantly, and this is all going to be unfriendly for Mortgage Bonds and home loan rates ahead.

So what should you do if you have been thinking about purchasing or refinancing a home? The good news is that home loan rates are still extremely attractive right now, so call or text me at 512-522-7284 today.

This is What’s News for Mortgage Rates This Week: January 10th.

Quick general rule of thumb when keeping an eye on mortgage rates.

Strong Economic News: $$$ from Bonds —> Stocks = Home Loan Rates Worsen

Weak Economic News: $$$ from Stocks —> Bonds = Home Loan Rates Improve

Want to see what other economic reports might impact home buyers and home refinance options in the coming week? Visit the Mortgage Market Update and check out the Economic Calendar.

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James K Barath, CMPS®

James K Barath is a Certified Mortgage Planning Specialist®, Certified FICO® Professional, Certified Military Housing Specialist® and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James for your FREE Home Loan Approval !  His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy!

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