“OML” Mortgage Market Update

The main influence on mortgage rates last week was the perceived progress, or lack thereof, on the fiscal cliff talks. US economic data and news from Europe had little impact. Investors grew a little less hopeful during the week about a fiscal cliff deal, so mortgage rates ended the week a little lower.

If no action is taken, a series of tax increases and government spending cuts will take effect at the first of the year, known as the fiscal cliff. During the week, political leaders from both parties made a series of statements about the changing status of negotiations to avoid the fiscal cliff. The result for financial markets was increased daily volatility in the stock and bond markets. Opinions vary widely on the level of progress, but investors ended the week with reduced optimism for a deal. As long as the talks drag on, the increased level of volatility is likely to continue.

If Congress is not able to reach a deal to avoid the fiscal cliff, economic growth can be expected to slow significantly. However, slower economic growth generally reduces inflationary pressures and is positive for mortgage rates. Therefore, as optimism for a deal rises or falls, so have mortgage rates.

The biggest US economic report this week will be the important Employment data on Friday. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month. Before the employment data, ISM Manufacturing, and Construction Spending will be released on Monday. Productivity and ISM Services will come out on Wednesday. Consumer Sentiment is also scheduled for Friday.

Give Donna, Pete, Cody or Drew a call today to discuss rates & get your buyer “Pre-Approved”.

You can reach any/all of us at 918-592-6000.

Thank You For Your Partnership.

Make It A Great Week!

 

 

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