Mortgage Rates A Little Better Today

Quiet today but it was a little better for the bond and stock markets. Mortgage rates took a break from reacting to headlines coming out of Europe and focused instead on domestic economic data.  That turned out to be helpful today as Retail Sales came in much weaker than expected.  Downbeat economic data generally helps rates move lower.  Today was no exception, but the gains were modest.

This morning’s June retail sales were soft.  If this was stronger or at the estimate it would have been touted as more evidence that the consumer was ready to keep spending - that it was weaker it was ignored by investors blaming some of it on wet weather in most of the country in June. Retail sales does not include spending on Amazon or other on line buying sites, seems that is a better place to sweep it than weather. May sales were also revised lower from original report.

Tomorrow Yellen is at the House Financial Services Committee. She will start at 9:00 and likely it will end about Noon. Usually the first day of her testimony covers most of the important comments - Thursday she will testify at the Senate Banking Committee, rather see her at the senate first though.

Yellen will likely continue the ‘data dependent’ answer to when the Fed will make the first move on increasing the FF rate. The odds of a September rate increase from the Federal Reserve have dropped to roughly one-fifth where they were in December, based on the prices of futures contracts linked to the fed funds rate… but I am still holding my belief that there will not be any increase this year.

In summary, mortgage pricing improved a bit today following a very disappointing retail sales number. This number is certain to be looked at closely by the Feds come their next meeting. In other news tomorrow brings us yet another Greek vote. Last time they voted the bond market caught a bit of a rally but that does not mean it will happen again. Still too much risk to consider to float at this time – best bet is too lock.