CHM Blog

Daily Market Analysis March 14, 2022

March 14th, 2022 10:01 AM by Richard Sardella MLO.100007700/NMLS 233568


Daily Market Analysis

The 10 yr. note yield made a new high going back to Jan 2019, the high last night and this morning 2.10%, in mid-Feb the note high was 2.08% before it dropped to 1.70%; the last six sessions the 10 up 40 bps as of this morning. Stock indexes overnight traded better with the DJIA +240 at 9 am ET.

There are no data points today, but this week does have key economic releases. More important, the FOMC policy statement and announcement of a rate increase and Powell’s press conference. Markets looking for 0.25% increase in the FF rate, its what the statement and Powell say about what the Fed will continue to do about rates as inflation increases daily. The fastest consumer price gains in four decades, Powell and colleagues now have to deal with the economic fallout of the war, which threatens to deliver the twin blows of weaker growth and even-quicker inflation. In FF futures trading presently the expectations are for 165 bps increase this year (six quarter point increases). Goldman Sachs Group Inc. predict officials will eventually stop raising rates at 3% sometime next year. The cost of food, fuel and metals has soared since the war began with gasoline alone at a record, while prices for many services were already higher.

At 9:30 am the DJIA opened +222, NASDAQ -38, S&P +13. 10 yr. note 2.09% +9 bp. FNMA 3.5 30 yr. coupon -44 bps and -52 bps from 9:30 am Friday.

U.S. economic growth is looking lower than expected in 2022 and the risks for recession in the next year are rising, according to Goldman Sachs; cutting their outlook for GDP for the full year to 2.9%, down from 3.1% in the most recent revision, and to just 1.75% as measured from the fourth quarter of 2021 to the final three-month period of 2022. Among the reasons given for the diminished view is the added pressure from the Russia-Ukraine war and its impact on U.S. inflation that is running at the highest level since January 1982. “The largest risk to the US economy from the war in Ukraine remains higher commodity prices,” … “Rising commodity prices will likely result in a drag on consumer spending, as households — and lower-income households in particular — are forced to spend a larger share of income on food and gas.” (Goldman economist Joseph Briggs said) While the probability that the U.S. enters recession remains low, Goldman said the chances are rising, particularly if oil price increases escalate.

PRICES @ 10:00 AM

10 yr note: 2.10% +10 bp

5 yr note: 2.04% +10 bp

2 Yr note: 1.82% +7 bp

30 yr bond: 2.45% +9 bp

Libor Rates: 1 mo 0.397%; 3 mo 0.826%; 6 mo 1.130%; 1 yr 1.596% (3/11/22)

30 yr FNMA 3.5: @9:30 am 101.31 -44 bp (-52 bp from 9:30 am Friday)

30 yr FNMA 4.0: @9:30 am 103.39 -34 bp (N/A)

30 yr GNMA 3.5: @9:30 am 102.02 -47 bp N/A)

Dollar/Yuan: $6.3632 +$0.0234

Dollar/Yen: 117.98 +0.66 yen

Dollar/Euro: $1.0941 +$0.0027

Dollar Index: 98.97 -0.15

Gold: $1963.00 -$22.00

Bitcoin: 38,80 +173

Crude Oil: $102.96 -$6.37

DJIA: 33,144 +200

NASDAQ: 12,800 -56

S&P 500: 4210 +6 bp

About Richard Sardella

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.

About This Report And Disclosure Information

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.

Posted by Richard Sardella MLO.100007700/NMLS 233568 on March 14th, 2022 10:01 AM

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