Daily Rate Lock Advisory

Indexes Affecting Rate Lock

High

Positive

Durable Goods Orders

The first of this morning’s three economic reports was August's Durable Goods Orders at 8:30 AM ET. It showed that new orders for products such as airplanes, electronics and appliances slipped 0.2% last month when forecasts were calling for a 0.1% decline. A secondary reading that excludes orders for larger airplane and other transportation products also came in slightly softer than expectations. The headline numbers are good news for bonds and rates because they show weaker manufacturing activity. However, this data is known to be volatile from month to month, so the slight variance in today’s report is not nearly as meaningful as it would have been in other reports. In fact, we saw bonds well in positive ground before this data was released.

Medium

Negative

Consumer Confidence Index

September's Consumer Confidence Index (CCI) was posted at 10:00 AM ET this morning with the Conference Board announcing a reading of 108.0. This reading was an increase from August’s revised 103.6 and higher than the 104.3 that was predicted. The increase signals surveyed consumers felt better about their own finances this month than they did last month. Because rising confidence usually translates into stronger levels of consumer spending that fuels economic growth, we have to label this report as unfavorable for mortgage rates.

Low

Negative

New Home Sales

Today’s final economic report was August's New Home Sales data that revealed sales of newly constructed homes spiked 28.8% last month, greatly exceeding forecasts. This was a surprisingly strong report, especially considering analysts were expecting to see a decline in sales. Even though this data carries relatively low importance to the markets, the sizable variance from forecasts is having a negative impact on this morning’s trading.

Medium

Unknown

Treasury Auctions (5,7,10,20,30 year)

We also have the first of this week's two potentially influential Treasury auctions to watch this afternoon. The Treasury is selling 5-year Notes today and 7-year Notes tomorrow. They will tell us if there is an appetite in the markets for medium-term securities. If investor demand in these sales is strong, particularly from international buyers, the broader bond market should move higher, pushing mortgage rates lower. But a lackluster interest from investors could lead to bond selling and higher mortgage pricing. The results of the sales will be announced at 1:00 PM ET each day, so any reaction will come during afternoon trading.

Medium

Unknown

Fed Talk

Tomorrow doesn’t have any relevant economic reports set for release, but there are five Fed member speaking engagements taking place. One of them is by Fed Chairman Powell at 10:15 AM ET. He is due to make the opening remarks at a community bank conference in Missouri. While his appearances are always watched closely, this event is being done via a pre-recorded message that prevents him from taking any questions. It also minimizes the possibility of him saying something that will move the markets. The other four are scheduled throughout the day, so we may see a reaction in the markets at any time.

Rate Lock Advisory

Mortgage Rate Trend

Indexes Affecting Rate Lock

Durable Goods Orders

Consumer Confidence Index

New Home Sales

Treasury Auctions (5,7,10,20,30 year)

Fed Talk

Float / Lock Recommendation