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18th June, 25
Remarkable Absence of Mortgage Rate Volatility
It happens, but it's rare. A Fed "dot plot" day has come and gone with mortgage rates almost perfectly unchanged from the previous day. This speaks to the level of indecision not only in the market, but also among Fed members. First off, what's a "dot plot day?" The dot plot (or simply, "the dots") refers to a chart/table in the Fed's economic projections that shows where each Fed member sees the Fed Funds Rate at the end of the next few years. These projections only come out on 4 of the 8 Fed days per year and they've grown to be a leading source of volatility for financial
Remarkable Absence of Mortgage Rate Volatility
It happens, but it's rare. A Fed "dot plot" day has come and gone with mortgage rates almost perfectly unchanged from the previous day. This speaks to the level of indecision not only in the market, but also among Fed members. First off, what's a "dot plot day?" The dot plot (or simply, "the dots") refers to a chart/table in the Fed's economic projections that shows where each Fed member sees the Fed Funds Rate at the end of the next few years. These projections only come out on 4 of the 8 Fed days per year and they've grown to be a leading source of volatility for financial
18th June, 25
Here's What Changed in The New Fed Announcement
Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, remains low, and labor market conditions remain solid. Inflation remains somewhat elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook has increased further. diminished but remains elevated. The Committee is attentive to the risks to both sides of its dual mandate and judges
Here's What Changed in The New Fed Announcement
Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, remains low, and labor market conditions remain solid. Inflation remains somewhat elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook has increased further. diminished but remains elevated. The Committee is attentive to the risks to both sides of its dual mandate and judges
18th June, 25
HELOC, Marketing, Down Payment Products; STRATMOR Tech Survey; Compliance Based on Customer Expectations
Today we hear from the U.S. Federal Reserve. We can expect no change to overnight fed funds. As pointed yesterday by Dr. Paul Brewbaker, the economist who spoke here at the MBA Hawai’i conference, the Fed can only shoot at one target at a time: inflation or employment. They have to pick one and have picked inflation. So far so good. Besides that, he tore into tariffs, and their result on what individuals and countries do in response to them as evidenced by what happened during the first Trump Administration: China moving its manufacturing facilities to non-tariff countries to circumvent the
HELOC, Marketing, Down Payment Products; STRATMOR Tech Survey; Compliance Based on Customer Expectations
Today we hear from the U.S. Federal Reserve. We can expect no change to overnight fed funds. As pointed yesterday by Dr. Paul Brewbaker, the economist who spoke here at the MBA Hawai’i conference, the Fed can only shoot at one target at a time: inflation or employment. They have to pick one and have picked inflation. So far so good. Besides that, he tore into tariffs, and their result on what individuals and countries do in response to them as evidenced by what happened during the first Trump Administration: China moving its manufacturing facilities to non-tariff countries to circumvent the
18th June, 25
Once Again: Today is Not About a Fed Rate Cut
Fed day is here and there's a 0% chance of a rate cut. That's been the case for just over a month due a combination of April's jobs report and the stock market recovery in May (or the underlying events that helped facilitate it). In order to cut, the Fed would need to see the sort of deterioration in the labor market it saw in 2024 as well as the sort of progress it saw on inflation. The latter is possibly in play, but then there's the debate about whether or not new trade policies will cause a bit of upward pressure. Even without the complication of tariff uncertainty, note 2024's "
Once Again: Today is Not About a Fed Rate Cut
Fed day is here and there's a 0% chance of a rate cut. That's been the case for just over a month due a combination of April's jobs report and the stock market recovery in May (or the underlying events that helped facilitate it). In order to cut, the Fed would need to see the sort of deterioration in the labor market it saw in 2024 as well as the sort of progress it saw on inflation. The latter is possibly in play, but then there's the debate about whether or not new trade policies will cause a bit of upward pressure. Even without the complication of tariff uncertainty, note 2024's "
17th June, 25
Dot Plot in Focus With Fed's "No Cut" Announcement
Dot Plot in Focus With Fed's "No Cut" Announcement Bonds lost some ground after this morning's economic data, arguably in response to the Retail Sales control group beating its forecast. Higher-than-expected import prices could also have played a supporting role, but the selling was too modest to worry about perfectly allocating the blame. It was also erased by an afternoon rally that was best explained by general risk-off vibes surrounding geopolitical headlines. Here too, we're not seeing anything too compelling in terms of trading justification. The best bet on
Dot Plot in Focus With Fed's "No Cut" Announcement
Dot Plot in Focus With Fed's "No Cut" Announcement Bonds lost some ground after this morning's economic data, arguably in response to the Retail Sales control group beating its forecast. Higher-than-expected import prices could also have played a supporting role, but the selling was too modest to worry about perfectly allocating the blame. It was also erased by an afternoon rally that was best explained by general risk-off vibes surrounding geopolitical headlines. Here too, we're not seeing anything too compelling in terms of trading justification. The best bet on
17th June, 25
Mortgage Rates Slightly Lower Ahead of Fed Day
Mortgage rates continue operating in a narrow range with almost every day of the past two months falling between 6.8 and 7.0% for a top tier 30yr fixed scenario. Today's average rate fell 0.03 after moving up 0.06 since June 12th. This morning's most relevant potential influence--the Retail Sales report--turned out to have a limited impact this morning. To be fair, when rates are as stable as they have been, there's no need to overanalyze their underlying motivations. For those determined to do it anyway, today's best example may have been general market anxiety surrounding war in
Mortgage Rates Slightly Lower Ahead of Fed Day
Mortgage rates continue operating in a narrow range with almost every day of the past two months falling between 6.8 and 7.0% for a top tier 30yr fixed scenario. Today's average rate fell 0.03 after moving up 0.06 since June 12th. This morning's most relevant potential influence--the Retail Sales report--turned out to have a limited impact this morning. To be fair, when rates are as stable as they have been, there's no need to overanalyze their underlying motivations. For those determined to do it anyway, today's best example may have been general market anxiety surrounding war in
17th June, 25
Marketing, Broker, Processing, MSR Trading Platform; LOs and MISMO; Webinars and Training
In Spain, Spaniards are shooting water pistols at foreigners to protest the impact of mass tourism: it has created a housing crunch. Tourism in the United States is down considerably, especially from Canada, impacting the economy here on Oahu and in other locations. But in the U.S. the inventory of properties for sale is increasing, and the market has turned for buyers at the expense of sellers. New listings rose 5.2 percent YOY, active inventory is up almost 28 percent year-over-year, days on the market have increased by 6 days, but home prices are essentially flat. Sellers at the lower end
Marketing, Broker, Processing, MSR Trading Platform; LOs and MISMO; Webinars and Training
In Spain, Spaniards are shooting water pistols at foreigners to protest the impact of mass tourism: it has created a housing crunch. Tourism in the United States is down considerably, especially from Canada, impacting the economy here on Oahu and in other locations. But in the U.S. the inventory of properties for sale is increasing, and the market has turned for buyers at the expense of sellers. New listings rose 5.2 percent YOY, active inventory is up almost 28 percent year-over-year, days on the market have increased by 6 days, but home prices are essentially flat. Sellers at the lower end
17th June, 25
Econ Data Not Weak Enough to Help
Bonds were decently stronger in the overnight session, but not for any new, specific reasons. Trading levels have been cutting an increasingly narrow, sideways range. Until that changes, a moderate rally following 2 days of weakness is the least surprising outcome. But that was before the AM data, which featured Retail Sales at -0.9 vs =0.8 f'cast. One would think that's worth more bond buying, but the control group (retail sales excluding autos/gas/building materials) rose to 0.4 vs 0.3 and had a small positive upward revision to last month. We've seen the control group set
Econ Data Not Weak Enough to Help
Bonds were decently stronger in the overnight session, but not for any new, specific reasons. Trading levels have been cutting an increasingly narrow, sideways range. Until that changes, a moderate rally following 2 days of weakness is the least surprising outcome. But that was before the AM data, which featured Retail Sales at -0.9 vs =0.8 f'cast. One would think that's worth more bond buying, but the control group (retail sales excluding autos/gas/building materials) rose to 0.4 vs 0.3 and had a small positive upward revision to last month. We've seen the control group set
16th June, 25
Token Weakness Without a Cause
Token Weakness Without a Cause Sometimes bonds rally or sell-off for no apparent reason, or at least for no reason that can be easily proven. That's been the case on each of the past two sessions with 30yr yields moving almost 10bps higher between the two of them. Geopolitical motivations have been nonexistent despite some efforts to link oil price concerns to bond weakness (not a solid thesis right now). Fiscal concerns may be having some small effect behind the scenes, but they're hard to substantiate based on the available headlines. The easiest approach would be to
Token Weakness Without a Cause
Token Weakness Without a Cause Sometimes bonds rally or sell-off for no apparent reason, or at least for no reason that can be easily proven. That's been the case on each of the past two sessions with 30yr yields moving almost 10bps higher between the two of them. Geopolitical motivations have been nonexistent despite some efforts to link oil price concerns to bond weakness (not a solid thesis right now). Fiscal concerns may be having some small effect behind the scenes, but they're hard to substantiate based on the available headlines. The easiest approach would be to
16th June, 25
Mortgage Rates Drift Slightly Higher to Start The Week
While there's been no shortage of political and geopolitical headlines over the past 2 business days, there hasn't been much by way of inspiration for the bond market. Bonds (and, thus, rates) have moved nonetheless. Perhaps it was the lower rates achieved last Thursday that prompted a pullback, or perhaps traders are pricing in some caution ahead of this week's data and Fed announcement. Either way, bonds lost ground on Friday and again today--both times with little by way of overt justification. Fortunately, the losses have been modest. They leave the average rate very much
Mortgage Rates Drift Slightly Higher to Start The Week
While there's been no shortage of political and geopolitical headlines over the past 2 business days, there hasn't been much by way of inspiration for the bond market. Bonds (and, thus, rates) have moved nonetheless. Perhaps it was the lower rates achieved last Thursday that prompted a pullback, or perhaps traders are pricing in some caution ahead of this week's data and Fed announcement. Either way, bonds lost ground on Friday and again today--both times with little by way of overt justification. Fortunately, the losses have been modest. They leave the average rate very much
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