Mortgage Rates Drop? YES!

Housing: Weekly Mortgage rates dropped and as rates dropped mortgage applications jumped +9.3% which was led by purchases.  Purchase reports jumped up by 12.0%. Refinance applications increased by 7.0%. All good news for the housing industry

Jobs: The April Job Openings and Labor Turnover Survey (JOLTS) showed 5.788 million jobs that are UNFILLED and was much higher than the market expectations of 5.672M and a nice jump over March’s revised 5.67M. So, if there are basically just under 6M jobs that are unfilled, how can the number of jobs added as reported in last week’s Non-Farm Payroll report be only 38K? Does it jive at all? Only if the answer is a very tight labor market.

Oil is back above $51 for the first time since July 2015 and has basically doubled since the lows in February. That is certainly inflationary and may play into the Fed’s decision come July. The rise in price is due to a lower than expected U.S. oil inventory and supply disruptions in Nigeria.

Great Brittan: April Industrial Production was much stronger than expected (2.0% vs est of 0.0%) with the YOY it was up 1.6% vs est of -0.4%

Bottom Line: Overall this is good news for the markets and after the good move in mortgage rates on Friday, we’re back to a very tight range in mortgage rates and don’t see a compelling reason why mortgage rates should push out of this range.  If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.  

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