May 14, 2019
It's been a while since the bond market (which dictates rates) has been able to digest what we would consider to be a "top tier" economic report. Why do we care about such things? Simply put, economic data is one of the key considerations for bonds. Stronger data tends to promote bond selling and thus higher mortgage rates. Conversely, when the data is weaker than expected, it generally coincides with rates holding ground or moving lower.
The "all other things being equal" caveat is imperative when it comes to economic data's impact on rates. There are certainly other factors that can supersede even the most important reports. That said, the other things are rarely scheduled in advance unless we're talking about monetary policy updates from the Fed or other major central banks.
So will tomorrow's data (Retail Sales, in this case) help or hurt rates? There's no way to know. If traders knew, they'd already have traded accordingly. All we know today is that rates have held their 1+ month low for a 2nd straight day and stand a chance to get a push in one direction or the other tomorrow morning.
Loan Originator Perspective
Bond markets were largely unchanged today, as equities licked their wounds and contemplated further Trump tariff trauma. With treasury yields near their 90 day low, feels like further rate drops from here may be tough to achieve. I am locking applications closing within 30 days for all but the most risk-craving clients. -Ted Rood, Senior Originator
Today's Most Prevalent Rates
- 30YR FIXED - 4.125 or 4.25
- FHA/VA - 4.0%
- 15 YEAR FIXED - 4.00%
- 5 YEAR ARMS - 3.875-4.25% depending on the lender
Ongoing Lock/Float Considerations
- Early 2019 saw a rapid reevaluation of big-picture trends in rates and in markets in general
- The Federal Reserve has been a key player, and while they aren't the ones pulling the global economic strings, their response to the economy has helped rates fall more quickly than they otherwise might.
- Based on the Fed's laundry list of concerns, the bond market (which determines rates) will be watching economic data closely, both at home and abroad. The stronger the data, the more rates could rise, while weaker data could lead to new long-term lows.
- Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders. The rates generally assume little-to-no origination or discount except as noted when applicable. Rates appearing on this page are "effective rates" that take day-to-day changes in upfront costs into consideration.