CHM Blog

Markets have already priced in a 25 basis point cut from the Fed and another 25 basis point cut at the October FOMC meeting. There is some speculation the cut may be as much as 50 basis point, although it isn’t likely, the Fed doesn’t look like its panicking and inflation remains elevated. Beside the usual policy statement, the Fed will release its quarterly projections over the next two years, expectations are for easing between now and the end of the year. Recent data on the labor market has shown a decline in job opening and increased unemployment claims, as for inflation it remains close to 3.0%. Until now that would keep the Fed from lowering rates, markets believe the slowing in employment will override the high level of inflation. After years of Powell being consumed with inflation fears it appears he has moderated, at least that is what markets believe.

After markets digest the FOMC and Powell on Wednesday expect to hear a lot about the debt ceiling that must be increased at the end of the month. Not news that the US debt is increasing while the US dollar is in decline, will investors continue to fund the debt? The 10 year last April broke below 4.00% for one day before slingshotting back to 4.50% within five days.

PRICES @ 10:00 AM

10 year note: 4.04% -2 bp

5 year note: 3.60% -3 bp

2 year note: 3.54% -2 bp

30 year bond: 4.66% -2 bp

30 year FNMA 5.5: @9:30 am 101.21 +7 bp (+10 bp from 9:30 am Friday)

30 year FNMA 6.0: @9:30 am 102.41 +1 bp (+3 bp from 9:30 am Friday)

30 year GNMA 5.5: @9:30 am 101.13 +1 bp (+1 bp from 9:30 am Friday)

Dollar/Yen: 147.26 -0.40 yen

Dollar/Euro: $1.1765 +$0.0031

Dollar Index: 97.37 -0.18

Gold: $3,701.70 +$15.30

Bitcoin: 114,462 -1217

Crude Oil: $63.22 +$0.53

DJIA: 45,932 +98

NASDAQ: 22,291 +150

S&P 500: 6616 +32

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.

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