Rate Lock Advisory

Tuesday, May 6th

Tuesday’s bond market has opened in negative territory with little to drive trading other than looking ahead to tomorrow’s Fed activities. Stocks are showing early losses with the Dow down 203 points and the Nasdaq down 147 points. The bond market is currently down 4/32 (4.36%), which should cause an increase in this morning’s mortgage rates of approximately .125 of a discount point.

4/32

Bonds

30 yr - 4.36%

203

Dow

41,015

147

NASDAQ

17,697

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium

Unknown

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

We don’t have any relevant economic data to be concerned about today. However, there is a 10-year Treasury Note auction taking place that may have an impact on rates later today. Good news for mortgage pricing would be a strong demand from investors. If there is a strong interest in the securities, we may see an improvement in the broader bond market after results are announced at 1:00 PM ET. This may lead to a downward revision in rates before the end of the day. On the other hand, a weak demand could cause an increase in mortgage rates this afternoon.

High

Unknown

Federal Open Market Committee (FOMC) Statement

There are no economic reports scheduled for release tomorrow, but the third FOMC meeting of the year will adjourn at 2:00 PM ET. Chairman Powell and friends are expected to leave key short-term interest rates at their current levels to allow time to see how tariffs and other conditions affect inflation and broader economic activity. This should be of no surprise to traders since Chairman Powell has made it very clear the Fed is no hurry to adjust key short-term interest rates despite political pressure to do so. Their post-meeting statement will be released when it adjourns, followed by a press conference at 2:30 PM with Chairman Powell. This meeting does not include revised economic projections.

High

Unknown

Misc Fed

It may not be the Fed's lack of action that fuels afternoon market volatility though. Traders will be looking closely at the statement and press conference for hints about future moves, and it is that topic that will likely drive trading tomorrow afternoon. There is plenty of speculation when the Fed may act, so any clarification could heavily influence bond trading and mortgage rates late tomorrow.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock 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.

The Shirley Group Real Estate Brokerage

5908 Circular Dr. | North Richland Hills, TX 76117
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