Mortgage Rates Hit 2017 Lows

Mortgage rates are now at their lowest points of 2017.  The bond and mortgage markets did manage to hold all of yesterday’s huge Trump rally on his remarks he wanted a lower dollar. Not sure what he was thinking since the dollar is crumbling under the feet of the Japanese yen and has declined from recent strength against the euro and the 16-currency dollar index has dropped from 120.25 to 100 since the year began.

Geo –politics also supporting the move lower in rates as we have been noting recently. The stock indexes also running low on momentum increasing the value of moving money to treasuries with no urgency to be in equities now. Add in to the pudding that it is Holy Week and Passover so many are not working leaving markets with less stability and subject to wider swings.

Not complaining though, as I have been bullish on bonds and MBSs for weeks, especially after the move yesterday successfully taking out the resistance at 2.30/2.32%, then the next resistance at 2.27%.

Markets closed tomorrow but the government will release March retail sales and March CPI. This week is a religious holiday, not a government holiday. This morning March PPI was reported, there were some that made a big point that inflation has moved above the Fed’s 2.0% on the overall PPI but that is not what the Fed relies on; the Fed and specifically Janet Yellen focus on the personal consumption expenditures not the PPI and CPI. PCE is released with monthly personal income and spending that will not happen until Monday May 1st.

No idea what lenders will do about pricing tomorrow - will they or will they not? And what will they base prices on? March retail sales and CPI? Or movements in Europe? If your sources do price expect prices to be on the conservative.

In summary, bonds have had a great rally over the last couple of days, so you should be seeing nicely improved rate sheets.  Typically, not a fan at locking with a holiday weekend ahead, but I think it would be wise to lock in these gains today.