Rates flat with inflation numbers coming in as expected

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Published Date 3/13/2018

Today's Mortgage Rate Summary

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.

Rates Currently Trending: Neutral

Mortgage rates are moving sideways so far today. The MBS market improved by +10 bps yesterday. This probably wasn't enough to improve mortgage rates or fees. The rates experienced moderate volatility yesterday.

Today's Rate Forecast: Neutral

Small Business Optimism: The February NFIB index moved higher from January's level of 106.9 to Feb's reading of 107.6. It the 2nd highest level in 45 years!

Inflation: Across the board, the Consumer Price Data matched market expectations with the closely watched YOY Headline reading rising to 2.2% in February from 2.1% in Jan. The Core YOY remained at the 1.8% level.

Geopolitical: As the White House is narrowing the field to replace Cohn as the Chief Economic Advisor, we learned this morning that former CIA Director Mike Pompeo has replaced secretary of State Rex Tillerson.

Treasury Dump: Today we have our 30-year bond auction at 1:00 pm Eastern

Across the Pond:

Japan: BofJ Minutes released later this afternoon

Eurozone: Finance Ministers meeting

Today's Potential Rate Volatility: Low

Inflation numbers were exactly in-line with expectations. There isn't any economic news due out for the rest of the day that is likely to push rates out of the tight channel. The one caveat is something unexpected geopolitically.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

Source: TBWS

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

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