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Market in Review

Moneek February 28, 2014


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Newsletter-March 3rd, 2014

Mark Griffith
co-host: The Housing Hour
NMLS #181569 TN License # 101988
Mortgage Investors Group
E-Mail: Mark.Griffith@migonline.com
Website: http://www.migonline.com/mark.griffith

Market Comment
Mortgage bond prices finished the week higher, which pushed rates lower. Prices were positive throughout almost the entire week. Weaker than expected consumer confidence data Tuesday morning set the tone and resulted in lower rates. New home sales were higher than expected but mortgage interest rates did not react much to the stronger release. Weekly jobless claims were higher than expected @ 348k versus the expected 335k and mortgage bond prices rose Thursday morning. Gross domestic product in the fourth quarter was revised lower. GDP rose 2.4% versus the expected 2.6% mark. Mortgage interest rates finished the week better by 5/8 of a discount point.
LOOKING AHEAD

Economic Indicator Release Date & Time Consensus Estimate Analysis
Personal Income and Outlays Monday, March 3, 10:00 am, et Up 0.1%, Up 0.3% Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates.
PCE Core Inflation Monday, March 3, 10:00 am, et Up 0.1% Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve.
ISM Index Monday, March 3, 10:00 am, et 51.8 Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates.
ADP Employment Wednesday, March 5, 2:00 pm, et 145k Important. An indication of employment. Weakness may bring lower rates.
Fed “Beige Book” Wednesday, March 5, 2:00 pm, et None Important. This Fed report details current economic conditions across the US. Signs of weakness may lead to lower rates.
Weekly Jobless Claims Thursday, March 6, 8:30 am, et 327k Important. An indication of employment. Higher claims may result in lower rates.
Revised Q4 Productivity Thursday, March 6, 8:30 am, et Up 1.2% Important. A measure of output per hour. Improvement may lead to lower mortgage rates.
Factory Orders Thursday, March 6, 10:00 am, et Up 0.1% Important. A measure of manufacturing sector strength. Weakness may lead to lower rates.
Employment Friday, March 7, 8:30 am, et 6.6%, Payrolls +125k/td>

Very important. An increase in unemployment or weakness in payrolls may bring lower rates.
Trade Data Friday, March 7, 8:30 am, et $38.2b deficit Important. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates.

Employment

The employment report provides an abundance of information for many sectors of the economy and is probably the most important piece of data released each month. Not only does the release give basic employment payroll statistics for the major working sectors, it also provides the average hourly earnings and the average workweek. Economists use this information provided by the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor to estimate many other economic indicators such as industrial production, personal income, housing starts, and GDP monthly revisions. Since there is little data for economists to base their estimates on, the margin of error for the estimates tends to be high. As a result, the employment report can cause substantial market movements. The BLS compiles data from two unrelated surveys that they conduct, the household survey and the establishment survey, in order to complete the report. This explains why there is sometimes a divergence between the unemployment rate and payrolls figure. Be alert heading into the release.

Copyright 2014. All Rights Reserved. Mortgage Market Information Services, Inc. www.ratelink.com The information contained herein is believed to be accurate, however no representation or warranties are written or implied.

MORTGAGE MARKET IN REVIEW RateLink Newsletter-March 10th, 2014 bad

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