Looking Back And Looking Ahead : July 7, 2008
Last week was fairly uneventful in the mortgage markets, with rates slightly edging lower across the board and without much data to influence trading.
Even Thursday morning’s hotly-anticipated jobs report was met with lukewarm interest; many traders had already left for the weekend.
Mortgage rates just drifted — a little up and little down, but mostly unchanged.
Mortgage insiders may have found last week to be boring, but for active home buyers, the semi-lull was a welcome break from the up-and-downs that have gripped the markets since January.
It’s been three consecutive weeks without a substantial increase to mortgage rates.
This week, rates aren’t expected to be as calm because Fed Chairman Ben Bernanke is taking two heavy topics and making public speeches about them.
The first speech is to the FDIC on Tuesday. The speech will focus on mortgage lending. The second is to House Financial Services Committee on Thursday and it will cover financial market regulation. In both speeches, expect Bernanke is expected to address inflation and the health of the U.S. banking system.
These two subjects are closely linked to mortgage rates so watch for rate movement during, and after, the speeches.
- If Bernanke says inflation is moderating, mortgage rates should fall
- If Bernanke says the financial system is stabilizing, mortgage rates should rise
From a data perspective, there’s not much doing other than Friday’s Consumer Confidence survey. Confidence surveys don’t have a direct impact on the economy, but markets are watching them more closely. A strong reading could benefit the stock market which should, in turn, cause mortgage rates to rise.
(Image courtesy: Wall Street Journal Online)
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