BORIS SMOLGOVSKY

2303 Camino Ramon, Ste 160
San Ramon, CA 94583

(925) 244-1099 | (800) 323-7975
Fax: (925) 244-1148

NMLS # 238115 | DRE # 01361455

BORIS SMOLGOVSKY image

BORIS SMOLGOVSKY

2303 Camino Ramon, Ste 160
San Ramon, CA 94583

(925) 244-1099 | (800) 323-7975
Fax: (925) 244-1148

NMLS # 238115 | DRE # 01361455

BORIS SMOLGOVSKY image
Thursday, July 18, 2024
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Market Commentary

Updated on July 18, 2024 10:17:39 AM EDT

Yesterday’s 20-year Treasury Bond auction went relatively well. The benchmarks indicated an above-average demand for the securities compared to other recent sales. Bonds had already improved before the results were announced at 1:00 PM ET, but the news seemed to boost them a little further. This was the time that some lenders started issuing an intraday improvement to rates. The downward revision wasn’t necessary only due to the auction. It looks as if lenders were looking for an opportunity to revise rates lower and it came in the sale results.

Also released late yesterday was the Federal Reserves Beige Book. It showed that five of the Fed’s twelve districts reported flat or slowing economic activity. This was up from three districts in the previous version of the report. Another favorable note was signs of inflation cooling and concerns about economic conditions over the next six months. In short, the report didn’t reveal any major surprises, but most of what it said was good news for bonds and mortgage rates.

The first of this morning’s two economic reports was last week’s unemployment update at 8:30 AM ET. The weekly snapshot showed more people initiated new claims for benefits than did the previous week, hinting at employment sector weakness. Last week’s 243,000 initial filings were a sizable increase from the revised 223,000 the week before and was well above predictions of 227,000.

This week’s last relevant economic report was Junes Leading Economic Indicators (LEI) at 10:00 AM ET. The Conference Board announced a 0.2% decline in the indicators, meaning they are predicting modestly slower economic activity over the next few months. Forecasts had the decline at 0.3% though, making the data slightly negative news for bonds and mortgage rates.

Tomorrow doesn’t have anything of importance scheduled, except for a couple of Fed-member speeches and some earnings releases. Unless there is a big surprise in one of the speeches or a big move in stocks as a result of the earnings headlines, we should see mortgage rates remain fairly calm.

 ©Mortgage Commentary 2024

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