Rates flat as Fed meeting kicks off

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Published Date 3/20/2018

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 to slightly higher so far today. The MBS market worsened by -8 bps yesterday. This probably wasn't enough to worsen mortgage rates or fees. The rates experienced moderate volatility yesterday.

Today's Rate Forecast: Neutral

Fed: Today starts two days of meetings for the Federal Open Market Committee (FOMC) which will culminate with Wednesday's policy announcement. They will also release their Economic Projections which includes the famous "dot plot chart' which shows the market what the expectations are from all of the Fed members (both voting and non-voting) of the Fed Fund Rate from now through 2020.

Geopolitical: The Trump administration is said to be considering plans to impose tariffs worth as much as $30 to $60 billion on Chinese products as early as this Friday to punish Beijing for intellectual property theft from American businesses.

Japan: Leading Economic Index 105.56 vs est 106.2

Germany: PPI YOY 1.8% vs est of 2.0%.

Great Britain: Retail Sales YOY 3.6% vs est 3.7%/PPI YOY 2.6% vs est of 2.7%/CPI YOY 2.7% vs est of 2.8%.

Eurozone: Second day of G20 summit.

Today's Potential Rate Volatility: Average

Mortgage rates are likely to move sideways once again today. Since there aren't any economic releases today, the one thing that can create volatility and move rates is an unexpected geopolitical event.

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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