Real Estate News

Economic Reports and Mortgage Rates


Written By: David Reed
Monday, December 24, 2018

Did you know that economic reports can impact mortgage rates? And that some economic reports have a greater impact than others? Each month and each quarter, various government agencies >Inflation is another key element that investors pay attention to and one of the key reports the Federal Reserve reviews when the Federal Open Market Committee, or FOMC, meets every six weeks. One of the Fedrsquo;s responsibilities is to control the cost of funds and attempts to do so by raising or lowering the Federal Funds rate. Inflation is measured on the wholesale level, the Producer Price Index and at the consumer level, or the Consumer Price Index.

These various reports give us a look back at recent economic activity and can provide clues as to what might occur in the future. Investors can then allocate their portfolios to make adjustments based upon expectations. For instance, if an investor sees a solid jobs report indicating a growing economy, the investor might allocate more funds toward stocks and less so in bonds. Stocks have the potential to provide greater returns compared to bonds. Bonds do provide a return, but the yield is >

Mortgage rates? Your typical 30 year fixed rate for a conforming loan tracks either the 30-yr FNMA bond or the FHLMC 30-yr bond. As the prices of either move, so too will interest rates. If an economic report is >

When mortgage lenders set their rates each day they do so after a review of various indices. There really is a process lenders practice when setting daily mortgage rates and tracking mortgage bonds and Treasury prices is the primary method. When you get a quote today from your loan officer for a 30 year rate and then get another quote tomorrow and the rates are a little different, you can bet there was some economic data >

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