It's Christmas Eve and my stomach is already growling for the turkey dinner we're going to be having later today. There's been a fair amount of (mixed) data over the last couple of days. I intended to write a post yesterday but then had major problems with my internet and had to replace a modem so here I am. Rather than go over every piece of data individually, I'll just say that the data was mixed but leaned toward good for the economy and not so much for rates.
In my post on Monday I recommended locking and taking advantage of the recent gains. I also said that if you are going to float, watch the market closely so that you could act quickly to lock in case it moved against you. After closing at 103.25 on Monday (43 basis points above Wednesday's close), Tuesday brought a different tone for the FNMA benchmark bond thanks to the data. It was basically a steady sell-off throughout the day with the bond closing down 33 basis points at 102.92. Yesterday was a very quiet day with very little movement. The benchmark bond closed 14 basis points above it's low for the day but still down 1 basis point. The market closes at 2:00 EST today and I really think that very little will happen. Jobless Claims were a bit better than expected at 267K vs. 270K.
Locking wouldn't be a bad thing. I don't expect too much to happen next week in between the Christmas and New Year's holidays but you never know. Remember that light trading can be very volatile so if your lender offers a float down options I prefer to protect my clients by locking in case bonds sell off and rates move higher but if there is an impetus for traders to buy in the short term pushing rates low enough to be able to float down, that is the better option as far as I'm concerned. That's all for now. I probably won't have much in the way of posts next week but I will be available if I can help with a pre-approval or if you have questions regarding locking / floating. I can be reached at 801-853-8720 or 702-812-1214 or by email at jed.wunderli@noblehomeloans.com. Have a very Merry Christmas.
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