There are four relevant reports scheduled for release this week that are likely to affect mortgage pricing. The first important release is the Institute for Supply Management’s (ISM) manufacturing index for July late tomorrow morning. This index measures manufacturer sentiment by surveying trade executives about business conditions during the month and is considered to be of fairly high importance to the markets. A reading above 50.0 means that more surveyed executives felt that business improved last month than those who said it had worsened. Tomorrow’s release is expected to show a reading of 54.2, down from last month’s 56.2, indicating manufacturer sentiment slipped in July. A smaller than expected reading would be good news for the bond market and would likely improve Delaware mortgage rates tomorrow. However, a stronger than expected reading could lead to higher Delaware mortgage rates.

June’s Personal Income and Outlays data will be posted early Tuesday morning. This report helps us measure consumer ability to spend and current spending habits. If it shows sizable increases, bond selling could lead to higher mortgage rates. Current forecasts are calling for an increase of 0.1% in income and no change in spending. A larger than expected increase in income means consumers have more funds to spend, which is not favorable to bonds because consumer spending makes up two-thirds of the U.S. economy. Ideally, we would like to see declines in spending and income.

Also, Tuesday morning will be the release of June’s Factory Orders data. This report helps us measure the manufacturing sector strength by tracking orders for both durable and non-durable goods during the month of June. It is similar to last week’s Durable Goods Orders report that tracks orders for big-ticket items only. Since a significant portion of the data was released last week, this report likely will not have as big of an impact on the markets as last weeks did. Analysts are expecting to see a decline in new orders of approximately 0.5%. A larger than expected drop would be considered good news for bonds and mortgage pricing.

There is no relevant monthly or quarterly economic news scheduled for release Wednesday or Thursday, but Friday is a different story. The most important piece of data this week and arguably each month is the monthly Employment report. This report gives us the U.S. unemployment rate, the number of jobs added or lost during the month and the average hourly earnings reading for July. The ideal situation for the bond market is rising unemployment, a sizable loss of jobs and little change in earnings.

While the GDP is arguably the single most important report in general, it is posted quarterly rather than monthly like the Employment report. Friday’s report is expected to show that the unemployment rate rose to 9.6% last month while approximately 85,000 jobs were lost. The unemployment rate probably will not be much of a factor unless it moved much more than the 0.1% that is expected. However, due to the importance of these readings, we will most likely see quite a bit of volatility in the markets and mortgage pricing Friday morning if they vary from forecasts.

Overall, I am expecting to see another fairly active week for Delaware mortgage rates. The most important day is Friday due to the data being released, but tomorrow is also a very important day with the ISM index scheduled for release. The rest of the week is likely to be a little calmer than Monday and Friday. We may see some pressure in bonds mid to late week ahead of Friday’s employment numbers, but we also need to watch the stock markets for significant moves that can influence bond trading. Accordingly, this is a good week to maintain contact with your mortgage professional.

If I were considering financing/refinancing a Delaware home, I would…. Lock if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

If you would like to apply for a Delaware Home Loan, you can APPLY ONLINE HERE, you can call John R. Thomas at 302-703-0727.

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