Economic Reports, Market Insight, Mortgage Rates

The Week Ahead for Mortgage Rates: July 2, 2012

July 2, 2012 by · 1 Comment 

EU affecting U.S. mortgage ratesMortgage markets improved only slightly last week despite a large 2-day rally that lasted through Wednesday and Thursday.

Unfortunately for mortgage rate shoppers in Northwest Indiana, markets were worse throughout the other 3 days of the week, which kept mortgage rates from dropping to new all-time lows. 

As with many weeks since the start of the year, political and economic action within the Eurozone dictated the direction of US mortgage rates. Last week’s 2-day EU Summit was the major driver of markets.

Click here to see today’s mortgage rates.

In the days leading up to the summit, mortgage rates worsened as optimism in summit’s outcome grew. This is because a stable Europe is good for the world’s economy which, in turn, encourages Wall Street investors to move money from “safe investments” such as U.S. mortgage bonds into more risky ones such as equities.

This creates an excess supply of mortgage bonds which causes mortgage rates to move higher.

Then, on the day prior to the summit, the optimism faded. Several Eurozone leaders expressed an unwillingness to compromise, rhetoric which drove investors back into “safe” asset classes, explaining the mid-week drop in mortgage rates.

Click here to see today’s mortgage rates.

However, Friday, in a surprise move, EU officials announced a plan to recapitalize Europe’s banks and to reduce borrowing costs for Spain and Italy, once again, pushing investors back into a risk-taking mood.

The news in Europe overshadowed strong housing reports here in the United States.

New Home Sales and the Pending Home Sales Index both gave strong results and inflationary pressures were shown to be in check. The housing market continues its slow, steady recovery.

Click here to see today’s mortgage rates.

This week, mortgage rates are expected to remain volatile. The markets have had the weekend to pick through the EU agreement and, later this week, the Bureau of Labor Statistics will release the June 2012 Non-Farm Payrolls report.

In addition, this is a holiday week so trading volume is expected to be lighter-than-usual. Mortgage markets will be closed Wednesday.

This is The Week Ahead for Mortgage Rates: July 2, 2012.

Click here to see today’s mortgage rates.

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

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

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

If you or someone you know is thinking about buying a home, the combination of low home loan rates and affordable home prices make this an ideal time to buy a home. Want to know if you can afford a new home? Call or text me at 512-522-7284 to discuss your personal situation and your home loan options!

Related Posts Plugin for WordPress, Blogger...
Be Sociable, Share!

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!

More Posts - Website

Follow Me:
TwitterFacebookLinkedInPinterest

  • Get your FICO Score with Score Watch® today! Click here!

Comments

One Response to “The Week Ahead for Mortgage Rates: July 2, 2012”

Trackbacks

Check out what others are saying about this post...
  1. […] James K Barath is a Certified Mortgage Planning Specialist®, Certified FICO® Professional, qualified liability advisor 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!Source: welcomehomenwi.com […]



Speak Your Mind

WelcomeHomeNWI.com