Colorado Home Mortgage Loan

Colorado Home Mortgage Refinance Loan rates saw very little movement today.  The only major economic report to be released today was the Consumer Confidence numbers.  It appears that Consumer Confidence is at an all time low and Colorado Home Mortgage Refinance Loan rates did see some action because of this.  Colorado Home Mortgage Refinance Loan rates dropped a bit but not enough to make any type of rate change in the lender rate sheets.  Most of what will impact the market will be released tomorrow and Colorado Home Mortgage Refinance Loan rates will certainly see some action because of this.  Listed below I have a simple break down of the reports released today and what we can expect tomorrow:

Consumer Confidence fell to a record low 50.0, which was a lot worse then the 56.0 expectation set in the market last week.  Colorado Home Mortgage Refinance Loan rates will see some improvements based on this information alone.  Consumer Confidence has a direct correlation to consumer spending, which accounts for two thirds of the economy. Consumer Confidence also has some correlation with joblessness, inflation, and real income. Typically only changes of five points or more are considered significant.  We had an 8.2 point drop from when the report was last issued and a 6 point drop from what was expected.  This should have had some strong impacts in the Colorado Home Mortgage Refinance Loan Markets, but so far it appears the FOMC is taking center stage.  There are other pressures that change consumer spending other than consumer confidence, inflation, joblessness, and regional business issues. Consumer Confidence is used to predict the direction of Consumer Spending but because of other influences, higher Confidence won’t always lead to higher Spending.  Higher Spending numbers could be in direct relation to higher inflation.  This would be bad for Colorado Home Mortgage Refinance Loan rates.  However this months report should have improved Colorado Home Mortgage Refinance Loan rates for now.

Two Other Reports released today Richmond Fed Survey and Case-Shiller Price index numbers play separate roles in the Colorado Home Mortgage Refinance Loan Markets, but not enough to be considered a mover and a shaker.  Richmond Fed Survey works similar to the Empire State report and reports on manufacturing areas.  The report indicated a reduction in manufacturing demand which is a sign that our economy appears to be retracting.  The Price Shiller Price Index which monitors price changes in 10 different cities seemed to indicate that pricing is down which should be good news for Colorado Home Mortgage Refinance Loan rates.  I only briefly talk about these because it does not impact the Colorado Home Mortgage Refinance Loan markets enough to make rates move.  However they were released today and the numbers seem to favor Colorado Home Mortgage Refinance Loan rates so I wanted to mention them.

FOMC Meeting will conclude tomorrow and reports will begin to leak in about what was discussed in the meeting.  The first thing that will be determined is the FOMC action.  Action normally relates to what the FOMC has decided to do to short term interest rates.  If no action is taken on Short-Term Interest rates, the FOMC will signal that Economic Stimulus continues to be its main course of action.  This will be good for Colorado Home Mortgage Refinance Loan rates.  If Short Term interest rates are increased then the FOMC will be combating inflation which is very negative for Colorado Home Mortgage Refinance Loan rates.  I believe that the FOMC will leave rates alone and that Colorado Home Mortgage Refinance Loan rates will react positively.  We just need to stay tuned to see if the board was split or not on this decision and we will need to watch for any major inflationary discussions.

Colorado Home Mortgage Rates appear to be on their way down today based on what the Mortgage Backed Securities market did today.  We had a variety of economic reports released which finally moved Colorado Home Mortgage Rates down for the 1^st time in about 10 days.  Inflation continues to be the primary concern for investors and was certainly a major concern expressed by the Federal Reserve in the last week or so.  We now have all the inflationary data in for the month of May, and it appears that the Federal Reserve may have over stated the inflation problem, at least for the moment.  Colorado Home Mortgage Rates began to improve a bit after Producer Price Index figures came in line with expectations.  The Federal Reserve has expressed its concern for higher inflationary pressures, but the data so far indicates that inflation is in line with expectation no major surprises.  Colorado Home Mortgage Rates have been climbing based on the expectation that Inflation reports would come in considerably higher then the current consensus put in place.  So far it appears the investors are getting closer to what true inflation is as apposed to the Federal Reserves current expectations. 

The Federal Reserve will need to watch that it does not express too much hype in relation to the information they release, otherwise they may loose some credibility in the market.  Obviously when the Federal Reserve speaks the market listens, but this over communication policy may create market gaps for the Federal Reserve, versus desired market movement.  Allen Greenspan had a history of keeping information close by and releasing the information at times of relevancy.  Colorado Home Mortgage markets reacted very quickly when the information came out, because the information was relevant to what they intended to do.  The Federal Reserve expressed concern over the last week or so, indicating that they would take steps to combat inflation.  They went as far as insinuating that a short term interest rate hike would be needed to slow down inflationary pressures.  This type of communication in the market would have definitely lead to an interest rate hike in the next Federal Reserve meeting, however Bernanke’s approach appears for the moment, to cry wolf with no actual action.  Will this benefit his creditability in the future?  Probably not.  Colorado Home Mortgage rates have always drawn its movements from market action, and anyone trading in MBS knows that reacting first can make the difference in their portfolios bottom line.  The Federal Reserve is a tool for investors and they count on that to be accurate and predictable.  I know that we have been used to one way for a long time, and who knows, maybe Bernanke’s new approach will pay off.  So far it appears that investors are left confused and frustrated by the lack there of, in the predictability of the Federal Reserves current action plan. 

Colorado Home Mortgage rates reacted to four economic reports: PPI, Core PPI, Housing Starts, and Industrial Production.  Listed below are the actual data report figures and their impacts on the Colorado Home Mortgage Rate market.

Producer Price Index reports on inflationary pressures between business to business and typically involves overseas transactions.  These inflationary numbers will outline global inflationary pressures and pressures brought into our domestic consumer numbers.  The index showed a 1.4% increase which was a little higher then the 1.0% expert consensus which investors had hoped for.  Normally that would have created some issues for Colorado Home Mortgage Rates, however after all the fears tied around inflation, it was not the surprise everyone was preparing for.  Core Producer Price Index which takes out the highly volatile Food and Energy components actually only increased by .2% which was exactly what investors were hoping for.  This information sent a vary strong sign that inflation is still a bit higher then what investors would like to see, but not the catastrophic issue the headlines played them out to be.  Overall the news was positive for Colorado Home Mortgage Rates.

Housing Starts came in just below 1 million its lowest level since 1999.  This may be a result of the Home Builders Associations current sentiment readings released yesterday, which indicated major concern by builders on the state of the housing market.  Fear of inventory drives down inventory supplies and as a result lowers the number of home permits being issued.  Colorado Home Mortgage rates will also react positive to this as investors look for safer investment opportunities during tough economic times.  The consensus was that housing starts would be around 980K and the actual Housing Starts came in at 975K.  Not a big difference, but keep in mind housing permit activity is always higher in the summer months which make the drop even more significant.  This will be monitored by the Colorado Home Mortgage rate market, but should not make a big difference on what Colorado Home Mortgage rates will do.

Finally, Industrial Production numbers were released.  The consensus on the Industrial Production numbers was for a 0.1% advancement in production, but the actual data indicated a -0.2% drop.  This was significant and helped move Colorado Home Mortgage Rates back down.  Industrial Production numbers currently measures the change in the production of the nation’s industrial industries as well as a measure of their industrial capacity.  The level of industrial production divided by the level of industrial capacity gives the capacity utilization rate. The manufacturing sector accounts for one quarter of the economy and is weighted heavily in predicting economic growth.  Stronger economic growth typically leads to higher inflation which is bad for Colorado Home Mortgage rates.  What is hard to compare on a report like this is how much of a production increase is good.  With economic numbers coming in at zero or below it seems that anything tied to economic growth leads investors to fear inflation.  This trend seems to be more prevalent today then ever before.  Economic growth is a part of our economic evolution and some growth is needed however it appears that any growth causes Colorado Home Mortgage rates to increase out of fear. 

We have a long way to go before investors begin to react in a predictable manner, but in the mean time please call me with your Colorado Home Mortgage questions.

Daniel

We saw another .25% hit on Colorado Home Mortgage Refinance Loan rates sparked by another day of inflation talk by the Federal Reserve.  Inflation seems to be a very hot topic and will create issues for Colorado Home Mortgage Refinance Loan rates until something else makes the headlines.  For two days now members of the Federal Reserve have been commenting on the state of the economy and have expressed very clearly that inflation remains their top priority.  Fisher the southern states representative on the Federal Reserve Board is known for his tough stance on inflation, but yesterday Bernanke continued the trend by reaffirming his position on inflation.  The mortgage backed securities market went on a selling spree and have not stopped in the last 48 hours.  We have seen some of the sharpest increases in Colorado Home Mortgage Refinance loan rates for the year.  Most lenders are offering Colorado Home Mortgage Refinance loan rates in the 6.5% range and if you have not locked in yet you may want to talk to your lender to see if the rates quoted 10 days ago will still be honored.  It is hard to make a FLOAT or LOCK recommendation on your Colorado Home Mortgage Refinance Loan rates today especially when the market is acting so irrational.

Global fears should be a real concern in the market today and should be monitored especially if it’s impacting your Colorado Home Mortgage Refinance Loan rates.  We should remember that much of the impacts are based on speculation about inflation not facts.  Not that I don’t think it is warranted, but none of the hard data being reported on inflation appears to be out of line.  Investors should come back to terms with their fears once we have more economic data to report on.  Colorado Home Mortgage Refinance Loan rates may improve as investors jump back in the market to buy at a bargain.  Obviously if this happens we may see some slight improvements in Colorado Home Mortgage Refinance Loan rates. 

The only Economic report coming out today was the trade balance which came in right in line with expectations.  The report had very little impact on what the market did.  Increases seen today with Colorado Home Mortgage Refinance Loan rates came from the continued upward spiral created by comments made earlier this week by the Federal Reserve.  We are probably not going to see much relief in Colorado Home Mortgage Refinance Loan rates until Friday the 13^th, which will be when or next Core inflationary report comes out.  Consumer Price index is expected to be released on that day which will give investor a much needed piece of the puzzle to determine whether Colorado Home Mortgage Refinance Loan rates will go up or start coming back down.

Right now we believe Colorado Home Mortgage Refinance Loan rates are set too high, but heck if you told me gas would be $4 a gallon 6 months ago I would have thought it to be highly unlikely as well.  Investors are driven on emotion and every investor appears to be fearful that the next person knows more then they do.  Investors being the lemmings they are will reaction to what everyone else is doing. The tendency in the market is to sell when everyone else is selling, and buy when everyone else is buying.  Colorado Home Mortgage Refinance Loan rates will react up or down Depending on what action investors are taking in the market.  Right now everyone is in a sell mode which has created an upward movement for Colorado Home Mortgage Refinance Loan rates.  How far it will go and when it will slow down is hard to say.  What can be said is that if the next couple economic reports come in as expected, then Colorado Home Mortgage Refinance Loan rates will settle down.  If the CPI report comes in like last month which was better then expected, we will see some rapid improvements in Colorado Home Mortgage Refinance Loan rates.  LOCKING now will have you locking at this year’s highest interest rate lock.  I believe that the trend will continue over the next week or so but not to the extent felt over the last two days.  We may see some of the conservative price approaches used by investors today lighten up.  This would relieve some of the upward trends being realized in the Colorado Home Mortgage Refinance Loan markets today.  Friday the 13^th can be a day of horrors or a day of reckoning.  My only fear is the superstitious tendency for that day, which is normally bad news, but everything else tells me things will improve and I will remain with my FLOAT recommendation.  If 6.0% is on the table taking it would be your best bet, but right now I don’t believe it is an option on your Colorado Home Mortgage Refinance Loan rate.  We do have other options to look at.  Does 5.375% appeal to anyone?  You should ask me about that one it may be the Colorado Home Mortgage Refinance Loan program you are looking for.

Daniel

Colorado Home Mortgage Loan rates take another hard hit today.  New and old concerns related to inflation continue to make the headlines and Colorado Home Mortgage Loan rates are reacting negatively towards it.  The only major economic report released today were the Pending Home Sales numbers which came in considerably higher then expected.  Colorado Home Mortgage Loan rates already impacted by inflationary concerns saw an even greater loss when the report was released.  Colorado Home Mortgage Loan rates jumped up about .25% today and about .5% since last week.  Most Colorado Home Mortgage Loan lenders have hedged their pricing to a point where Locking just does not make sense.  The fear hear is how bad will inflation be, and to what extent will it play in the Colorado Home Mortgage Loan market.  Most experts believe that Colorado Home Mortgage Loan rates will continue to rise on concerns that inflation will increase due to the continued price increases related to oil.  So if you are closing in the near future and have not Locked in a rate then LOCKING may be a good idea.  I would recommend a LOCK today at 6.0% if you can still get that rate.  Colorado Home Mortgage Loan rates do have some room to drop especially if investors regain some confidence lost during current inflationary concerns. 

Colorado Home Mortgage Loan rates are impacted by economic conditions.  One condition not mentioned in awhile, but appears to be a perfect explanation to the economic status of our country today is “Stagflation”.  Colorado Home Mortgage Loan rates always do well during bad economic times, but mixed in with inflationary pressures Colorado Home Mortgage Loan rates have no other direction to go then up.  Stagflation is an economic condition first proposed back in the 1970’s.  It is controlled by two principal contributors inflation and economic slow downs.  We are currently experiencing both these conditions and should be talking about managing our decisions based on lessons learned during our last “Stagflation period”.  Colorado Home Mortgage Loans are greatly impacted by monetary policy.  Monetary policy is controlled by the Federal Reserve.  The Federal Reserve has two major concerns on their hand, Inflation and decreasing economic growth.  Depending on what policy the Federal Reserve implements can and will create a negative influence on the policy not being enforced.  For example if the Federal Reserve fights inflation then they will jeopardize stimulating economic growth.  Like wise Federal Reserve policy to stimulate economic growth will negatively impact inflation.  Kind of a damned if you do and damned if you don’t. 

Colorado Home Mortgage Loan rates also react positively or negatively depending on the policies being implemented by the Federal Reserve.  If the Federal Reserve combats inflation Colorado Home Mortgage Loan rates will react positively.  Likewise several techniques used to stimulate economic growth, like increasing the money supply will have a negative result on Colorado Home Mortgage Loan rates.   Stagflation was last felt during the late 1970’s, and though the Federal Reserve recognizes the issues on hand, they are conflicted on how the resolve the issue.  Fishers concerns on inflation lead to a steep increase in Colorado Home Mortgage Loan rates today and appears to be his biggest concern, however Bernanke and the other Federal Reserve Board members all feel Economic stimulation should be their primary concern.  This is why we are seeing Colorado Home Mortgage Loan rates increase and it is also why we are in the making of another possible “Stagflation Period”. 

As I stated before Stagflation can result when and economy is slowed by an unfavorable supply shock, such as an increase in the price of oil hear in the U.S. As inflation increases Economic conditions tend to worsen.  When the Economy faces times of uncertainty and an obvious decrease in production monetary policy is used to kick start the sluggish economy.  When the Federal Reserve jumps in and begins to increase the supply of money they increase the pressure centered around inflation.  As a result inflation increases even more.  The increased inflation causes Colorado Home Mortgage Loan rates to go up. Stagflation only becomes a problem when the marginal impact on Policies used to combat the economic issues cause more harm then good.  Generally the Federal Reserve can either stimulate the economy or attempt to rein it by adjusting interest rates making it cheaper to borrow money.  Adjusting the rate down tends to improve growth but it also increases the pressure on inflation. Adjusting the rate up tends to fight inflation but it hinders economic growth. During periods properly described as stagflation both problems co-exist. Major economic conditions of unusual proportion will have already created near-crises on both fronts before stagflation can set in.  I don’t have a solution to where Colorado Home Mortgage Loan rates will go but our government needs to improve on policy decision especially during such a fragile moment in time.  Let’s not have history repeat itself or we may find our unemployment rate hit 10% and Colorado Home Mortgage Loan rates will hit 10%.

Now with that said, I am confident that the Federal Reserve will do the right thing for the best long term results.  Now we may not like what they are doing, but so far they have shown no signs of repeating bad economic decisions.  Especially over supply issues in the money supply.  Call me with your Colorado Home Mortgage Loan questions and give me a chance to help you find the right Colorado Home Mortgage Loan.

Daniel 

Colorado Home Mortgage Loan rates took a hard hit today on reports that Inflation appeared to be under estimated.  Bill Gross an investment guru and expert in the market made some strong statements indicating that current inflationary data appeared to be under estimated, and that inflation data going forward would be worse then expected.  Bill Gross currently runs the biggest investment portfolio at PIMCO and has been an expert in this field for many years.  His comments to me appear to be accurate, but he does not sit on any committees responsible for reporting inflationary data.  These comments are made based on his professional opinion and by looking at the recent increases in oil, I believe he is correct.  Colorado Home Mortgage Loan rates took about a .25% hit today and appears to be on the rise.  Much of the activity felt in the Colorado Home Mortgage Loan rate market was based on fear, but the fear does seem to be warranted.  It is hard to gauge the exact impact oil will have on inflation, but it is easy to see that it will be a negative impact.  Colorado Home Mortgage Loan rates will continue to jump up as negative inflationary data comes in. 

I have implemented a FLOAT recommendation today simply because the increases felt  today were a result of fear, not hard statistical data released by any economic reporting agencies.  Colorado Home Mortgage Loan rates jumped up today and as a result 5.75% may not be available.  I am maintaining a Colorado Home Mortgage Loan lock recommendation at 5.75% and unless I see something in the data that requires we increase this recommendation to a higher rates will have my clients floating.  Floating will stay as the recommendation until we can get that Colorado Home Mortgage Loan rate at or below 5.75%.  It’s interesting what 24 hours will do, yesterday the feeling was that we have some tough times ahead and that we are not even close to being out of the economical debacle we currently face.  Today I am seeing experts changing their tune on the news that Jobless Claims came in better then expected.  Come on!  Realistically we have some tough times ahead which normally means Colorado Home Mortgage Loan rates should be getting better, but we have one major obstacle and that will be inflationary pressure.  Any positive gains in the Colorado Home Mortgage Loan market due to economic issues will be off set by how bad inflation reacts over the next 12 months.  To what extent this will happen is still hard to gauge.   

The Jobless claims report came in at 365K new claims filed, which is slightly better then the 370K expected.  Normally this alone would not create and movement in Colorado Home Mortgage Loan rates, but today it did push Colorado Home Mortgage Loan rates up a bit.  Initial jobless claims measure the number of first time filings for state jobless benefits. Claims are quite volatile from week to week; therefore many analysts track a four-week moving average to get a better sense of the underlying trend. The report also contains two other statistics- the number of people receiving state benefits and the insured unemployment rate.  The four-week moving average and continuing claims are watched more closely for changes. The labor market is considered to be improving when the four-week moving average goes below 400,000. If unemployment goes low enough it can put wage pressure on the economy and can cause increases in interest rates.  What is interesting about today’s release is that it is the 4^th highest Jobless Claims reported in the last 3 years yet the forecast seemed to be viewed as a positive sign for economic recovery.  Go figure.  Colorado Home Mortgage Loan rates in the past would have responded very positive to the high number, but with such terrible data being released month after month it actual appeared as an improvement. 

Tomorrow we will see our last economic report until Tuesday of next week.  Existing Home Sales will create some movement for Colorado Home Mortgage Loan rates but it does not move the market much.    The Existing Home Sales Index reports the number of existing homes sold, expressed on an annual basis. The sales of existing homes accounts for 84% of all houses sold and the total volume indicates housing demand.  The report is a strong predictor of future national mortgage origination volume and for near term spending for housing-related items.  Mortgage origination has reported negative increases the last two weeks so it is expected that tomorrows report will come in low.  Colorado Home Mortgage Loan rates should respond well but it will not make up all the ground lost today.  Not only will it not make up the ground lost today we may see Colorado Home Mortgage Loan rates get worse if inflationary concerns continue to dominate the Headlines. 

I do think its funny how Congress has required Oil CEO’s to come out and justify their profits.  What they should be working on is alternative solution to a problem that will not go away.  We have a Varity of options to explore and talking about whose fault it is will not solve the problem.  Colorado Home Mortgage Loan Rates will continue to see obstacles as long as oil continues to rise.  Oil is the biggest cost component in shipping which contributes a major impact to the ending price set on goods.  The increases felt in the market will translate to higher inflation.  We have a long way to go, and I do not have a solution to the problem, but I do believe we should do less talking and more doing.  For the sake of time I will limit my tirade to this one thought.  On rare occasions government intervention does help market systems and in the case of Oil something has to be done.  Those that voted in our current leadership party voted on the premises of change.  Well it appears to me that change has not happened.  What’s scary is that it does not appear that change will happen anytime soon.  Contrary to what these congressional people promised NOTHING HAS CHANGED.  If anything things are worse.  If we want change, maybe we need to re-look at who we voted in and think long and hard about voting someone else in. 

If you have time Check out www.coloradomortgagebanking.com/news for more insights on economic conditions.  Please call me with your Colorado Home Mortgage Loan questions.  God bless.

Daniel

 Colorado Home Mortgage Loan rates will be impacted by tomorrows Core PPI report.  PPI measures the change in prices, paid by producers, for a fixed basket of capital and consumer goods. It also measures the change in prices received by the manufacturing, mining, agriculture and electric utility industries. The “core” PPI excludes the often-volatile food and energy sectors and gives a clearer picture of the underlying inflation trend.  Colorado Home Mortgage Loan markets watch this closely because when inflation goes up the value of their bond drops.  When bond values drops the market develops an inverse relationship between bond prices and interest rates.  The inverse relationship causes Colorado Home Mortgage Loan rates to go up as bond prices go down.  Core PPI does exclude food and energy, but oil still makes its way into the numbers.  When Oil prices are high, the cost of shipping increases.  When the cost of shipping is up the cost of goods naturally follows.  Higher priced goods translate into higher priced products sold to the consumer.  The end result is INFLATION.  No way to avoid it, Colorado Home Mortgage Loan rates will always have negative reactions to inflationary pressures.  We do have a little bit of hope as it relates to PPI and that is CPI.  CPI which was reported a week ago came in lower then expected.  These two reports have similar characteristics and normally run in the same patterns.  Even though CPI came in lower then expected, I really have no guess on where Core PPI will come in at.  Normally I would predict a higher then expected number, however because Consumer Price Index came in lower then expected it might be safe to assume that PPI will do the same.  However I do not want to speculate, because everything else points to a higher then expected PPI number.

So Far today’s Mortgage Backed Securities market appears to be light in trading, but the price of bonds are on their way up.  This is good news for Colorado Home Mortgage Loan rates.  I am hoping that we are seeing some insider trading going on in anticipation of tomorrows PPI report.  It could also mean that we have some investors that lack the confidence in trading stocks today.  Regardless of the reason, Colorado Home Mortgage Loan rates do appear to be improving for the moment.  I definitely recommend LOCKING today the risk/reward is not worth floating through tomorrow.  Now if you are risk taker and PPI comes in low then you will see at least an 1/8^th better on your rate going into Wednesday. 

Today the only economic report we had was the Leading Indicators report which came in higher then expected.  Experts predicted a -.1% growth rate when in fact we had a Positive .1% increase.  This by its self had no impact on Colorado Home Mortgage Loan rates.  The Leading Indicators report is composed of ten indicators designed to forecast the strength of the economy six to nine months into the future. The ten indicators are picked from different parts of the economy and are chosen because of their relevancy and accuracy. They are each given equal weight when applied to the composite index.  The LEI can predict peaks and troughs in the economy but because many of the indictors are released individually before the LEI composite index is released, market rarely watch the report very closely.  Some of these indicators include but are not limited to; consumer price index, Hotel Occupancy Rates, total imports, tourist arrivals, and more.  These numbers give economist a basic understanding on the direction the economy is heading.  You can see why Colorado Home Mortgage Loan rates can be impacted, but it is the individual reports like Consumer Pricing Index which is released before this report where the real impacts are felt.

To get a basic understanding on the direction of Colorado Home Mortgage Loan rates visit www.coloradomortgagebanking.com  until then please call me direction for any of your Colorado Home Mortgage Loan questions.

Daniel

Colorado Home Mortgage Refinance Loan Rates will be impacted by 4 economic reports Tuesday and Wednesday.  Consumer Confidence, Advanced GDP, Chicago PMI, and Finally information coming out of the Federal Open Market Committee meeting.  All of the data coming out of these reports will send signals to the market indicating economic stability.  As you know this information is vital to the pricing of Colorado Home Mortgage Refinance Loan Rates. 

Consumer Confidence has a direct correlation to consumer spending, which accounts for two thirds of the economy. Consumer Confidence also has some correlation with joblessness, inflation, and real income. Typically only changes of five points or more are considered significant with higher numbers pointing to greater consumer spending. There are other pressures that change consumer spending other than consumer confidence, inflation, joblessness, and regional business issues. Consumer Confidence is used to predict the direction of Consumer Spending but because of other influences, higher Confidence won’t always lead to higher Spending.  This report will have an impact on Tuesdays Colorado Home Mortgage Refinance Loan rates.

Colorado Home Mortgage Refinance Loan rates are also influenced heavily by advanced GDP.  GDP is a significant report for several reasons. It is the most encompassing picture of economic activity and when paired with the employment report gives a picture of productivity growth. The data is used to define business cycle peaks and troughs. Higher GDP points to accelerated inflation while lower GDP indicates a weak economy.

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.  So far this year manufacturing shows signs of contracting.  Contraction in manufacturing is considered bad for the economy, but good for Colorado Home Mortgage Refinance Loan rates.

Finally the Federal Open Market Committee meet to determine new monetary policy direction for our financial markets.  So Far the Federal Reserve action has been to lower interest rates, which by 99.9% of Americans means interest rates are falling.  THIS IS NOT TRUE.  Lower short term rates means more liquidity more liquidity means more spending.  When the economy spends more it does stimulate the economy, but it also has very negative influences on inflations.  We all should know by now that high inflation means Colorado Home Mortgage Refinance Loan Rates will suffer.  We expect the information coming out of Wednesday Federal Open Market Committee meeting to signal a .25% short term interest reduction.  Anything higher will cause Colorado Home Mortgage Refinance Loan Rates to increase out of fear for inflation. 

I have Colorado Home Mortgage Refinance Loan rate information posted at www.coloradomortgagebanking.com/news  In the mean time let me know of any Colorado Home Mortgage Refinance Loan Rate questions you might have.  FLOAT remains our recommendation and you can read more about that at the site listed above.  Best of luck and seem my post tomorrow sometime after 1pm.

Colorado Home Mortgage Loan rates continue to be the center of attention for those buying homes in the near future.  I am asked constantly about how I determine where rates are going.  Simply put I make an educated guess based on the economic data and the live pricing feeds I have into the Mortgage Backed Securities market.  It is actually very simple to predict the direction Colorado Home Mortgage Loan rates will go.  If the Mortgage Backed Securities market indicates that the prices on bonds are increasing then the rate on Colorado Home Mortgage Loans will decrease.  Likewise, if the Mortgage Backed Securities price decreases Colorado Home Mortgage Loan rates will increase.  The economic data released into the market projects the state of the economy today.  If the economy shows signs of improvements Mortgage Backed Securities will drop in price.  The reason they drop in price is due to investors moving money out of safe Mortgage Backed Securities investments and into high risk stock investments.  Colorado Home Mortgage Loan rates will certainly increase when money is moved out of Mortgage Backed Securities market. 

Over the last 9 Months the economic news has been very negative which in return has put Colorado Home Mortgage Loan rates into a very pleasing price range.  It seems like everyone I talk to wants and expects to get their rate into the 5.5% range which has been the low points over the last 9 months.  We have experienced this low point about every 60 days or so.  It really depends on what the trend in the Mortgage Backed Securities market is and how investors are reacting to the economic data being released.  Inflation continues to be the negative influencer for Colorado home Mortgage Loan rates.  The mere fact that it is mentioned normally has Colorado Home Mortgage Loan rates moving in the wrong direction.  The key to locking is to figure out when the low point will happen before you actually close on your loan. 

So far we are trending around 5.875% which is still good for Colorado Home Mortgage Loan rates, but we certainly would like to get a little lower.  So far today the Mortgage Backed Securities market has not responded well and it appears at least this morning that investors believe that the Durable goods report will come in better then expected.  I am still not convinced and as I stated on my other blog www.coloradomortgagebanking.com today’s pricing trends normally predict what’s in store for the economic data being released the next day.  We will have to watch for a late day rally to see if any insider information makes its way into the market.  Rates will certainly be a little worse today, based on what I am seeing in the market.  Though rates will jump a bit we are still holding strong on our FLOAT recommendation, no need to overreact with the market.  If Durable Goods come in below expectations we will see some positive changes in the Colorado Home Mortgage Loan rate market.  Stay tuned I will update you on live market pricing as it happens. 

Right now the Mortgage Backed Securities market is not responding the way we would like.  On the news front Ambac posted a 1.7 Billion dollar loss.  Ambac is a bond insurer and losses with this company signals instability in Mortgage Backed Securities.  This will probably be the reason Mortgage Backed Securities take some hits today.  Colorado Home Mortgage Loan rates increased to its highest point in 6 months the last time a bond insurer company reported losses.  Today we will not see the news effect the market as much because of all the other turmoil we are experiencing in the stock market.  Company after company continues its lower then expected profit reports which will help minimize the decreases felt from Ambac news.  Stay tuned, today will be an interesting day.  We expect Colorado Home Mortgage Loan rates to improve over time, but today will not be that day.  Hopefully the economic data released tomorrow will push out the negative press on Ambac and help get Colorado Home Mortgage Loan rates back where locking makes sense.

We had three economic reports come out today all of which appears to be good news for Mortgage Backed Securities.  The main thing to monitor will be volume.  If Volume is low then Colorado Home Mortgage Loan rates will increase until something stimulated activity in the market.  So far today that has been the case and Colorado Home Mortgage Loan rates are beginning to increase slightly.  This can also be a direct reflection on the volume created in the stock market over the last couple of days.  This trend will likely stop and Colorado Home Mortgage Loan rates are expected to recover next week.  Each of the reports today indicated that we are still in a bit of a mess as it relates to our economy.  Each report reminded us that we are not out of the woods and we still have work to do before recovery is recognized.  Jobless Claims came in as expected and showed that we are still extremely high.  Colorado Home Mortgage Loan rates should have responded well to the news and rates should come down a bit.  The four-week moving average and continuing claims are watched more closely for changes. The labor market is considered to be improving when the four-week moving average goes below 400,000. If unemployment goes low enough it can put wage pressure on the economy and can cause increases in interest rates.

Leading indicator report came out as expected today.  The Leading Indicators report is composed of ten indicators designed to forecast the strength of the economy six to nine months into the future. The ten indicators are picked from different parts of the economy and are chosen because of their relevancy and accuracy. They are each given equal weight when applied to the composite index.  This report basically give you the state of the economy and can show whether we are moving forward as a whole.  Colorado Home Mortgage Loan rates don’t typically move with this indicator, but it does give us some idea whether we are in a recovery state or not.

Finally the Philadelphia Fed Index is used to get a sense of the Manufacturing component which accounts for about 20% of our market.  The Philadelphia Fed Index is considered to be a good indicator of changes in everything from employment, general prices, and conditions within the manufacturing industry. Manufacturing is considered to be a precursor to future economic conditions and it lays the groundwork toward economic recovery. For example, in a poor economy if manufacturing starts to pick up there is an expectation that the economy will soon follow behind.  In short the reports don’t lie the economy still needs help in a bad way, and normally when the economy suffers Colorado Home Mortgage Loan rates show improvements. 

ADP’s numbers are in and so far nothing out of the ordinary.  They have reported employment numbers right in line with what investors expected.  Colorado Home Mortgage refinance loan rates did creep up a bit today, but this was still primarily from yesterday’s market activity.  Colorado Home Mortgage refinance loan rates moved up about .125% this morning and have pretty much maintained that level throughout the day.  I did however get a pricing alert from one of my investors late this morning, indicating a price improvement.  I believe the dust is settling from yesterday and investors are beginning to cash in on some short term stock profits by selling.  When investors sell off stock they typically move their money into safer investments like Mortgage Backed Securities.  When demand for MBS increases Colorado Home Mortgage Refinance loan rates will drop.  Several other reports came out today, but none of them caused any real movement in the market.  What we do have to remember is that the reports currently being released have not painted any good pictures for what is to come.  The news being reported still indicate that we are at some of the lowest points we have seen in some time and investors are aware of this.  As soon the tolerance for risk drops for investors,  the sooner the demand for Mortgage Backed Securities will increase.  A couple more reports indicating bad economic data should do the trick.  Look for rates to drop again by Friday, how much will depend on how bad the employment figures turn out to be.  Colorado Home Mortgage refinance lock recommendation remains as a FLOAT.  Be ready to LOCK quickly if the news on Friday comes out better then expected, but so far nothing has indicated that this would be the case.  This was probably the reason we saw a Colorado Home Mortgage refinance loan pricing alert for the better today.  Stay tuned and check out www.Coloradomortgagebanking.com/news  when you get a chance.