October 13th, 2015 12:09 PM by Dale DiGennaro
Mortgage Time
Mortgage Market News for the week ending October 09, 2015
Compliments of
DaleDiGennaro
Owner | NMLS: 298353 | 966783
Custom Lending Group, Inc.
Co. NMLS: 845079 | 944064
Office: 707.252.2700 - Ext. 109•Cell: 707.738.0878Fax: 707.252.1319
dale@clgroup.netwww.customlending.net/Home
1700 Soscol Avenue
Suite 22
Napa,CA94559
Stocks Rally, Rates Rise
Demand shifted from bonds to stocks over the past week. The economic data had little impact. As a result, mortgage rates ended the week a little higher.
Under most circumstances, mortgage rates improve when stocks decline, and the reverse is true as well. We have seen an example of this relationship over the last few weeks. During the second half of September, stocks declined and mortgage rates improved. The trend has reversed, however, as the Dow has climbed about 600 points over the past week, while mortgage rates have risen.
There were no major surprises in the Minutes from the September 17 Fed meeting released on Thursday. The Minutes revealed that Fed officials held off on a rate hike due to uncertainty that inflation will rise to their 2.0% target level. The Minutes also noted that weakness in other countries added to the downside risk for economic growth and inflation in the U.S. Since the September 17 Fed meeting, the U.S. economic data has indicated slowing growth, justifying the Fed's decision and adding pressure for the Fed to hold rates steady longer.
Looking ahead, Retail Sales will be released on Wednesday. Retail Sales account for about 70% of economic activity. The Consumer Price Index (CPI), the most closely watched monthly inflation report, will come out on Thursday. Industrial Production, another important indicator of economic activity, and the JOLTS report will be released on Friday. JOLTS measures job openings and labor turnover rates. Mortgage markets will be closed on Monday in observance of Columbus Day.