Colorado Mortgage rates take another hit today with durable goods.
Colorado Mortgage rates jump up again today on better then expected durable goods reporting. Durable goods came in at -.5% which is a bit better then the -.7% forecasted by investors. The key factor impacting Colorado mortgage rates were the core components in Durable Goods, which actually achieved a 2.5% growth rather then the .7% expected increase. Investors viewed the data in a positive light giving new confidence for investing. Colorado Mortgage rates increased as the demand for Mortgage Backed Securities dropped. Right now we should be seeing Colorado Mortgage rates around 6.0%, which is the highest point achieved this month. We will continue to monitor this closely. Today we will continue to support a FLOAT recommendation. Locking in now will only have you locking at this month’s highest point. We are expecting a variety of economic reports over the next couple of days which will create movement in Colorado Mortgage rates. The reports to watch for this week will be Core PCE and Chicago PMI.
The Personal Consumption Expenditures report is basically a measure of goods and services targeted towards individuals and consumed by individuals. There are two broad indexes of consumer prices in the United States: the Consumer Price Index (CPI) and the PCE index. They are similar in many respects, but there are some important differences which can lead to large gaps between CPI and PCE inflation rates at times. The PCE uses a chain index which takes into account consumers’ changing consumption due to prices, while the CPI uses a fixed basket of goods with weightings that do not change over time. Economists frequently focus on the Core rate, which excludes the volatile food and energy components. The PCE is the Fed’s favorite inflation indicator and Colorado mortgage markets tend to be extremely sensitive to unexpected changes to the reported numbers. As inflation and expectations of future inflation rates change, the Colorado Mortgage markets adjust interest rates to reflect those changes. The effect of these changes is seen across all markets, equities, bonds and mortgage backed securities. As a general rule, higher inflation is negative for Colorado Mortgage rates.
The Chicago PMI is measured by new orders, production, supplier deliveries, inventories and employment; asking for positive, negative or unchanged readings of each. A reading above 50% generally indicates that the manufacturing sector is expanding, and below 50% signifies contraction. It is looked at as a good indicator for future inflationary pressures and can have a big effect on the markets. Changes in prices paid by manufacturers can be indicative of accelerating or decelerating inflation and future manufacturing activity can be predicted by changes in new orders. Strength in the manufacturing sector may be a sign of a strong economy and is usually negative for Colorado Mortgage bonds.
As I said over the last couple days, activity in the Colorado Mortgage rates market will be high this week. Nothing moves Colorado Mortgage rates in any specific direction like inflationary pressures. These reports will release inflationary numbers and the Colorado Mortgage market will react immediately. If the inflationary numbers are high, Colorado Mortgage Rates will increase. If the numbers come back lower then expected then a Colorado Mortgage rate recovery will be in place. We will have to sit tight until Thursday or Friday of this week to see any real movement. If you have some time check out www.coloradomortgagebanking.com/news I look forward in assisting you with your future Colorado Mortgage needs.
Daniel
Tags: Colorado Mortgage, Colorado Mortgage Rates, Mortgage Rates
