January 30th, 2023 9:04 AM by Richard Sardella MLO.100007700/NMLS 233568
It is Fed week, Wednesday the FOMC will announce a 25 bp increase in the FF rate. Not the increase that is the focus but how the Fed and Jerome Powell will address the outlook and what the Fed may be contemplating over the next few months. Not only the Fed, but the BofJ, ECB, UK central banks set to announce their plans. The economy can be measured in many ways; weaker growth, wage pressures, commodity prices, earnings from businesses, take your pick.
At 9:30 am the DJIA opened -107, NASDAQ -104, S&P -23. 10 year note 3.55% +4 bps. FNMA 5.5 30 year coupon at 9:30 am -25 bps from Friday and unchanged from 9:30 am Friday morning.
For the last three weeks the 10 year note has traded between 3.60% and 3.40% with very solid support at 3.40%. The trading range is subject to breaking on Wednesday when the policy statement from the FOMC is released and Jerome Powell’s press conference. With the lockout the last week for Fed officials’ comments the market doesn’t have any new opinions based on remarks. The last we heard from various Fedsters is the Fed remains intent on driving inflation to 2.0% and won’t back down; clear as a bell, but the market is tilting toward believing the Fed will stop rate increases after Wednesday. The Fed says yes, the market saying no. Investors bet fading inflation will allow the central bank to soon cease raising borrowing costs and then cut them later this year, wishful thinking as far as Powell is concerned.
PRICES @ 10:00 AM
10 yr note: 3.55% +4 bp
5 yr note: 3.67% +6 bp
2 Yr note: 4.27% +8 bp
30 yr bond: 3.64% +1 bp
Libor Rates: 1 mo 5.70%; 3 mo 4.825%; 6 mo 5.102%; 1 yr 5.136% (1/27/23)
30 yr FNMA 6.0: @9:30 am 102.39 -16 bp (+12 bp from 9:30 am Friday)
30 yr FNMA 5.5: @9:30 am 101.25 -25 bp (unch from 9:30 am Friday)
30 yr GNMA 5.5: @9:30 am 101.25 -23 bp (-2 bp from 9:30 am Friday)
Dollar/Yuan: $6.7504 -$0.0343
Dollar/Yen: 120.25 +0.41 yen
Dollar/Euro: $1.0897 +$0.0029
Dollar Index: 101.88 -0.05
Gold: $1926.60 -$2.80
Bitcoin: 23,197 -595
Crude Oil: $78.69 -$0.99
DJIA: 33,965 -13
NASDAQ: 11,534 -88
S&P 500: 4055 -15
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.