Ryan's Rate Commentary



  • How Rates Move:

    Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up. Tracking these securities real-time is critical. For more information about the rate market, contact me directly. I’m among few mortgage professionals who have access to live trading screens during market hours.

    Rates Currently Trending: LOWER
    Mortgage rates are trending unchanged this morning. Mortgage rates are trending unchanged this morning. Last week the MBS market was essentially unchanged. The MBS market was slightly volatile last week. The MBS market was slightly volatile last week.


    This Week's Rate Forecast: NEUTRAL
    Three Things: These are the three main areas that have the greatest ability to impact rates this week. 1) Jobs, 2) ISMs and 3) Geopolitical.

    1) Jobs: We have a ton of job and wage related data this week culminating in Big Jobs Friday. The market will be watching the deluge of jobs data closely as last week the Fed said that Inflation had indeed made "substantial progress" towards their goals however labor still lagged. If we get a strong jobs report on Friday, that may start to pressure pricing towards a taper in 2021.

    2) ISMs: We get very important ISM Manufacturing and Services this week. Both releases will show exactly what our growth pace is and contain very important internal readings on employment as well.

    3) Geopolitical: The bond market will continue to watch the discussions on the budget reconciliation process in an attempt to push through $3.5T in spending along with another $1T (about half of that number was previously allocated from prior Covid relief Bills, only half is new money) that the Senate has already passed. Hand in hand with that is the ability to pay for that with a Debt Ceiling fast approaching that will have to be raised or this all comes to a big halt.

    This Week's Potential Volatility: NEUTRAL
    This morning we're seeing some positive movement in the markets. Volatility will stay moderate depending on incoming jobs data. Keep a look out for Big jobs Friday.



    Bottom Line:
    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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