Daily Rate Lock Advisory

Indexes Affecting Rate Lock

Low

Neutral

Treasury Auctions (5,7,10,20,30 year)

Yesterday’s 7-year Treasury Note auction was another uneventful sale in terms of impact on mortgage rates. The benchmarks showed an average level of interest in the securities compared to other recent sales. We saw little reaction in the bond market after results were announced at 1:00 PM ET. It came as no surprise that the sale was a non-factor since it was a shorter-term security sale and demand wasn’t overly strong or weak.

Medium

Negative

Durable Goods Orders

Today’s calendar of events kicked off with the release of March's Durable Goods Orders report at 8:30 AM ET. It revealed a 0.8% increase in new orders at U.S. manufacturers for big-ticket products such as airplanes, appliances and electronics. This was a little stronger than the 0.5% that was expected, but this data is known to be quite volatile from month to month. Therefore, a variance of this size isn’t nearly as meaningful as it would have been in many other reports. A secondary reading that excludes more volatile and costly transportation orders (airplanes) is what makes this report unfavorable for bonds and mortgage rates. That reading showed a 0.9% rise in new orders, exceeding forecasts of a 0.4% increase to signal strength in the manufacturing sector.

Low

Negative

Housing Starts (New Home Construction)

This morning’s second release included February and March Housing Starts data that was previously delayed by the government shutdown. It showed no surprises in February’s new home groundbreakings, but March’s number was higher than anticipated. This data gives us a small measure of housing sector strength that doesn’t usually affect mortgage rates. We are labeling the data bad news because of March’s higher number of starts even though the report didn’t seem to draw a reaction in the bond market or affect this morning’s mortgage pricing.

High

Unknown

Federal Open Market Committee (FOMC) Statement

We also have today’s FOMC meeting adjournment that may bring some afternoon volatility to the markets. We aren’t expecting any big surprises with literally no possibility of the Fed raising or lowering key short-term interest rates at this meeting. The best chance of getting a strong reaction is something said during the press conference. The meeting will adjourn and the statement will be released at 2:00 PM ET. The press conference with Chairman Powell will start at 2:30 PM ET. This meeting does not include revised economic projections or the dot-plot that predicts where key rates will be in the future.

High

Unknown

Gross Domestic Product (GDP)

Tomorrow has four pieces of data set for release, ranging for the weekly unemployment update to the highly important initial Gross Domestic Product (GDP) reading for the first three months of the year and a report that includes the Fed’s preferred inflation gauges. Look for details on tomorrow’s activities in this afternoon’s update that will be posted shortly after the markets have an opportunity to react to the Fed events.

Rate Lock Advisory