Daily Rate Lock Advisory

Indexes Affecting Rate Lock

Medium

Negative

Industrial Production

Today’s only relevant economic data revealed output at U.S. factories, mines and utilities was much stronger than expected last month. April’s Industrial Production report was released at 9:15 AM ET, showing a 0.7% jump in output. This was much stronger than the 0.2% that was expected and hints at manufacturing sector growth. Accordingly, as a sign of economic strength, we are labeling the report bad news for bonds and mortgage rates. However, this data has had little impact on this morning’s trading. Bonds were already posting heavy losses well before the data was released.

High

Negative

Geopolitical/Financial Issues

This morning’s negative open in bonds is likely a result of a lack of any concrete progress on the Strait of Hormuz, Iran, tariffs and other relevant topics during President Trump’s summit in China that has now ended. The result is higher oil prices and bond yields up. We have to go back almost a full year to see when the benchmark 10-year Treasury Note yield was last at today’s level. Since mortgage rates tend to track bond yields, this is troublesome for mortgage shoppers.

Medium

Unknown

FOMC Meeting Minutes

Next week has very little in terms of scheduled economic reports that may affect mortgage rates. There appears to be only three monthly releases and the first doesn’t come until Thursday morning. In addition to those reports, there also is a 20-year Treasury Bond auction and the release of the minutes from this month’s FOMC meeting set for midweek. Iran news and comments from some of the many Fed speeches happening next week could also contribute to changes in mortgage rates multiple days. Look for details on the scheduled activities in Sunday evening’s weekly preview.

Rate Lock Advisory

Mortgage Rate Trend

Indexes Affecting Rate Lock

Industrial Production

Geopolitical/Financial Issues

FOMC Meeting Minutes

Float / Lock Recommendation