Rates Drop on Weak CPI and Retail Sales Data

By:: Paul King | January 15, 2008

Rates were down today and bond prices up on weaker than expected economic news. Also, the stock market was down following the largest quarterly loss on record for CitiGroup. Rates should improve by at least .25 to price today. Both the December Retail Sales and the PPI came in today weaker than expected. Retail Sales posted a drop of .4%, where analysts were expecting data to be in line with November. This shows further weakening in consumer spending, a large part of the US economy. It is further evidence that we are entering a recession and good news for mortgage rates. The December PPI showed a decline of only .1% in the overall reading, weaker than expected and affirms that inflationary pressures are waning and are also good news for Mortgage Rates. Tomorrow we'll get the December CPI, which is more important than the PPI, as consumer prices make up a larger portion of the economy than producer prices. Again we're expecting a .2% rise and weaker readings could cause bond prices to rise. Also on deck tomorrow is the December Industrial Production Report which gauges the strength of the industrial sector and could help rates if it comes in weaker than expected.

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Mortgage Rates Operating in Unprecedented Environment

By:: Bill Rice - MortgageLoan.com | October 10, 2008

Mortgage rates are now officially operating in a historically unprecedented environment. This would trigger broad, cautious counsel to lock rates. Although we have seen steady downward pressure on mortgage rates throughout the week yesterday sparked an unusual effect in the bond markets.