Market Overview, Mortgage News, Weekly Review

What’s News for Mortgage Rates This Week: January 31st

January 31, 2011 by · Leave a Comment 

Political Unrest in Egypt is the Latest Fuel to Mortgage Volatility by James BarathThe news last week demonstrated that economic conditions are improving, but they are doing so gradually. As a result, the market remains volatile, as Mortgage Bonds and home loan rates move up and down depending on what reports or speeches hit the news wires.

Mortgage Bonds received a bit of a bump at the end of last week, helping home loan rates recover from losses earlier in the week. This boost was prompted by political turmoil in Egypt that had worldwide investors seeking the safety of Bonds.

The markets will continue to watch the political unrest in Egypt closely this week. In addition, a number of high-impact reports will hit this week with the big news coming this Friday!

  • We start off right away Monday morning with reports on Personal Spending and Personal Income, as well as the Personal Consumption Expenditures (PCE) Index, which is the Fed’s favorite gauge of inflation.
  • Manufacturing will also be in the news this week. On Monday, we’ll see the Chicago PMI, which surveys more than 200 Chicago purchasing managers about the manufacturing industry and is a good indicator of overall economic activity. Then on Tuesday, the ISM Index will be released. This is the king of all manufacturing indices and is considered the single best snapshot of the factory sector.
  • The big topic of the week will be employment. First up is the ADP National Employment Report on Wednesday, which measures non-farm private employment.
  • The ADP report will be followed by another round of Initial Jobless Claims on Thursday. In last week’s report, Initial Jobless Claims came in well above expectations. We shouldn’t read too much into that spike, since weather could have played a sizable role in the jump. However, if readings over the next couple weeks don’t settle back down closer to the 400,000 level, there may be reason for concern.
  • Finally, the busy week culminates in the all-important Jobs Report on Friday. This report features new data regarding Non-Farm Payrolls, the Average Work Week, Hourly Earnings and the Unemployment Rate. Needless to say, this report can be a big market mover!

The good news is that despite the volatility, home loan rates remain extremely low for now and present a tremendous opportunity for home buyers who lock in at the opportune moment.

This is What’s News for Mortgage Rates This Week: January 31st.

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

To learn more about the volatility and how you or someone you know can benefit from a knowledgeable Certified Mortgage Planner like myself, please call or text me at 512-522-7284. I’ll be happy to discuss the current economic climate and what it means to your personal situation and your home loan options.

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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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