The 30 year fiixed rate is at 6.5% today.
Mortgage/Economy news:
Retail sales numbers showed tremendous resilience in May. They crushed expectations, with overall sales rising 1.0%. They were even better excluding autos, up 1.2%. A rebound in the stock market was already underway, according to the futures markets, prior to the data being released. Investors must have been expecting strong results.
Since weekly jobless claims rose significantly, from 357K to 384K, the retail sales data is obviously more important to this morning’s traders. If you recall, the massive sell off in stocks last Friday was a direct result of a huge spike in the unemployment rate. However, the retail figures imply that businesses are still going to be profitable (perhaps even more profitable with lower payrolls), and therefore their stocks will maintain or grow in value.
Tomorrow’s CPI data, a measure of consumer inflation, has the potential to be just as big as last week’s employment reports. That is because the Fed has already hinted that they may not be cutting rates anymore, which implies that it is just a matter of time before they start to raise them again. If the economy is started to recover (as suggested by May’s retail sales), then that obstacle is taken out of their decision. Then, they will turn their attention to inflation. It is a catch 22 for bonds though. If inflation is high, stocks may fall for fear that the Fed will raise their rate, but bonds naturally lose value due to inflation as well. If inflation is low, stocks will probably rise, but that will push investors to take money out of bonds. In other words, bond prices are more likely to fall than to rise tomorrow.
Mortgage helpful hints: FHA offers rehad money and non-occupant co-borrower programs.
Thought of the day:
Class is an aura of confidence that is being sure without being cocky. Class has nothing to do with money. Class never runs scared. It is self-discipline and self-knowledge. It’s the sure-footedness that comes with having proved you can meet life.
Ann Landers
(Provided by Steve Hale~Georgia Platinum Mortgage)
