The Nation’s international deficit in goods and services increased to $27.0 billion in June from $26.0 billion (revised) in May, as imports increased more than exports.
June 2009: -27.0 $ billion
May 2009: -26.0 $ billion
Rate Lock Advisory – Wednesday Feb. 11th
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Wednesday’s bond market has opened in positive territory again as traders continue to digest yesterday’s activities on the economic stimulus and Fed bailout packages. The stock markets are rebounding from yesterday’s sell off but have only been able to recover part this losses so far. The Dow is currently 55 points and the Nasdaq is up 8 points. The bond market is currently up 8/32, which should improve this morning’s mortgage rates by approximately .250 of a discount point.
Today’s only economic news was December’s Goods and Services Trade Balance that showed a trade deficit of $39.9 billion in December. This was a larger than expected deficit with latest forecasts calling for it to stand at $35.7 billion. But it was still the lowest trade deficit since February 2003. Unfortunately, this data is not considered to be of high importance to the bond market and mortgage rates.
The second stage of this week’s quarterly refunding or sales of govern ment debt is today with 10-year Treasury Notes being sold. The results of the sale will be posted at 1:00 PM ET. If it was met with strong demand, easing recent fears about the amount of debt being sold to fund the economic stimulus and Fed bailout programs, we should see bond prices move higher during afternoon trading. This may lead to a downward revision in mortgage rates. However, if the sale was met with a poor demand, we could see selling in bonds this afternoon that will lead to upward revisions to mortgage rates.
Tomorrow morning brings us the release of January’s Retail Sales data. This report is very important to the financial markets because it measures consumer spending. Since consumer spending makes up two-thirds of the U.S. economy, any related data is watched quite closely. If tomorrow’s report reveals weaker than expected sales, the bond market should thrive and mortgage rates will fall. However, a stronger reading than current forecast of a d ecline in sales of 0.3% may drive mortgage rates higher tomrorow.
If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
Tuesday’s bond market has opened in positive territory following early stock losses. The stock markets are giving back a good portion of yesterday’s gains with the Dow down 95 points and the Nasdaq down 21 points. The bond market is currently up 10/32, which should improve this morning’s mortgage rates by approximately .250 of a discount point. There is no relevant economic news scheduled for release today or tomorrow. The government did release some interesting information regarding the U.S. budget deficit. It estimated that the deficit was going to stand at $407 billion this fiscal year (October 1st through September 30th), which is an increase of over 150% from last year’s deficit. This news may come into play more often in the near future and could negatively affect bonds since the government will likely need to issue more debt to cover the deficit. The first economic report of the week is not considered to be of high importance. July’s Good s and Services Trade Balance data will be posted Thursday morning, giving us the size of the U.S. trade deficit. It is expected to show a deficit of approximately $58.0 billion, which would be an increase from June’s $56.8 billion. However, I would consider this the least important of this week’s releases, meaning it will likely have little impact on bond trading or mortgage rates. Overall, the latter part of the week will likely be pretty active for the bond market and mortgage rates. Friday’s Retail Sales and PPI reports are the week’s most important and make Friday the biggest day of the week. If we see weaker than expected readings in that data, we should see mortgage rates move lower for the week. However, stronger than expected readings will likely drive bond prices lower and mortgage rates higher. If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking pla ce between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers. |
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