Brief note from the desk of Miguel
Velazco Sr. MBA
Week of: Monday, March 19, 2012
Present Market Conditions
market is currently down ( higher mortgage rates), but we will still likely see
a slight improvement in this morning’s mortgage rates due to strength in bonds
late Friday. There is nothing of importance scheduled for release today. The
rest of the week brings us the release of four monthly reports for the bond
market to digest, but none of them are considered to be highly important. Most
of this week’s data is related to housing. Three of the four reports that are
scheduled give us different insights into the housing sector.
They begin early tomorrow morning when February's Housing Starts will be
posted. This report tracks construction starts of new housing. It doesn’t
usually cause much movement in mortgage rates and is considered one of the less
important reports we see each month. It is expected to show an increase of less
than 1% in housing starts, indicating slight growth in the housing sector. Good
news for the bond market and mortgage rates would be a sizable decline in new
tomorrow is the first of four lectures that Fed Chairman Bernanke will make at
the George Washington School of Business. The second is Thursday while the
remaining two are scheduled for next week. I doubt they will lead to movement
in the markets or changes to mortgage rates, but we will be watching the first
one at 12:45 PM tomorrow for any impact his words may have.
Overall, it is difficult to label one particular day as
the most important of the week. The single most important report will likely be
Wednesday’s Existing Home Sales, but none of the week's data is known to be a
major market mover. If the stock markets move lower, we could see gains in
bonds and improvements in mortgage rates. But, if stocks move higher, pressure
in bonds is possible, leading to higher mortgage pricing again. Therefore, I
still recommend proceeding with caution if you are floating an interest rate.
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