Rates on the Rise Due to Strong Economic Data?
Rates pushed higher this week on strong economic data. Many reports came in stronger than expected. Is this a sign of things to come? Let’s take a look at how we got here.
Thursday-Stronger than expected GDP and Jobless Claims data reported. Factory Orders came in close to expectations.
Freddie Mac reported average 30 year mortgage rate increased week over week to 4.46%, from 4.29%.
Wednesday-U.S. economy added 185,000 jobs last month. This is was less than the 204,000 in October. New home sales also surged-October New Home Sales increased 25% to an annual rate of 444K, above the consensus of 425K. ISM report stated economy is still growing at a moderate pace.
Tuesday-Investors sold MBS ahead of important labor market data coming out over the few days.
Monday-Stronger than expected data hurt MBS. ISM national manufacturing index rose to 57.3, above the consensus. Currently at the highest level since April 2011. Construction Spending also exceeded expectations.
Friday will report non-farm payrolls, unemployment rate and more. These two variables could push the market again.
Borrowers should consider locking in low rates while they can. More volatility may follow.