Delaware Mortgage Market Update – Wednesday May 6, 2008
Wednesday’s bond market has opened flat despite favorable economic news. The stock markets are mixed with the Dow down 20 points and the Nasdaq up 8 points. The bond market is currently nearly unchanged from yesterday’s closing level, but we will likely see a small increase in this morning’s mortgage rates as a result of weakness in bonds late yesterday.
The Labor Department gave us today’s only relevant economic news with the release of the 1st Quarter Productivity and Costs data. It showed a 2.2% increase in productivity, which exceeded forecasts by a fairly large margin. This is good news for bonds because higher levels of productivity allow the economy to expand with low levels of inflation.
The first of this week’s two most important Treasury auctions will take place today. The Treasury Department will hold a 10-year Note sale today and a 30 Year Bond sale tomorrow. Results of the auctions will be posted at 1:30 PM ET. If they were met with strong demand from investors, we could see bond prices rise enough during afternoon trading to cause downward revisions to mortgage rates. However, lackluster bidding could lead to higher mortgage pricing this afternoon and/or possibly tomorrow.
There is no relevant economic data scheduled for release tomorrow except the weekly unemployment figures from the Labor Department. They are expected to report that 375,000 new claims for benefits were filed last week. A significantly larger number would be good news for bonds and mortgage rates, while a sizable decline could hurt rates. If they report a figure anywhere close to the 375,000, this data will likely have little impact on the markets or mortgage rates tomorrow.
If you have questions about mortgages or would like information on getting a mortgage, please feel free to call me (John Thomas) at 302-368-7132, you can APPLY ONLINE HERE.
John R. Thomas – NMLS 38783
Certified Mortgage Planner – Primary Residential Mortgage, Inc.
302-703-0727 DE Office / 610-906-3109 PA Office / 410-412-3319 MD Office
248 E Chestnut Hill Rd, Newark, DE 19713
