What's going on and why does it matter?
Mortgage bonds are hovering near their 10-day moving average as the new week gets underway. The economic calendar is empty today, but there are several high-tiered economic reports scheduled for release this week, including the consumer inflation numbers tomorrow, the NY Fed Manufacturing Index on Wednesday, and the retail sales report on Thursday. This week also kicks off the start of the Q2 earnings season, whereby companies report corporate profits for the second quarter. In the meantime, coronavirus headlines remain quite grim, with more daily record rises in new cases. The Fed is scheduled to purchase up to $4.665 billion of mortgage bonds today, while the new supply of mortgage bonds hitting the market averaged about $6.2 billion per day last week.
What should you do about it?
Watch and see if mortgage bonds can remain above their 10-day moving average, but be prepared to lock your rate if mortgage bonds fall convincingly below that level.
Economic reports that may impact mortgage rates this week: