CHM Blog

This afternoon the FOMC will increase the FF rate by 25 bps taking it to a range of 5.25%/5.50%. The question that hangs over markets going into this afternoon’s meeting and Powell’s press conference is what it will mean going forward, will Powell squash the growing belief the Fed is finished, or continue his drive to push inflation to 2.0% which would mean more increases. The view that the end is in sight has increased over the last month, even some conjecturing the Fed may begin lowering rates by the end of this year. A Bloomberg survey done earlier this month suggests the first cut in rates will be March next year.

The survey questioning a recession suggests economists believe a recession will occur. Economists inching to a more optimistic outlook. The July survey 58% is down from 67% in an April survey.

At 9:30 am the DJIA opened -93, NASDAQ -3, S&P -6. 10 year 3.86% -3 bp. FNMA 6.0 30 year coupon at 9:30 am +10 bps from yesterday and +24 bps from 9:30 am yesterday.

At 10 am June new home sales expected at 727K were lower at 697K and May revised from 763K to 715K.

Weekly MBA mortgage applications declined last week with mortgage rates higher. The composite -1.8% with purchase apps down 2.5% and re-finances -0.4%.

Over night the IMF increased its global growth from 2.8% to 3.0%. The Bank of Japan will abandon its yield curve control policy with an announcement potentially coming as early as this Friday. Tomorrow the ECB is expected to announce a 25-bps rate hike tomorrow.

PRICES @ 10:00 AM

10 year note: 3.88% -1 bp

5 year note: 4.14% -3 bp

2 year note: 4.90% +2 bp

30 year bond: 3.92% -2 bp

30 year FNMA 6.0: @9:30 am 100.78 +10 bp (+24 bp from 9:30 am yesterday)

30 year FNMA 5.5: @9:30 am 99.44 +11 bp (+21 bp from 9:30 am yesterday)

30 year GNMA 5.5: @9:30 am 99.56 +11 bp (+20 bp from 9:30 am yesterday)

Dollar/Yuan: $7.1516 +$0.0153

Dollar/Yen: 140.40 -0.51 yen

Dollar/Euro: $1.1067 +$0.0012

Dollar Index: 101.17 -0.18

Gold: $1967.00 +$3.30

Bitcoin: 29,291 +65

Crude Oil: $79.03 -$0.60

DJIA: 35,540 -34

NASDAQ: 14,134 -16

S&P 500: 4561 -7

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.