Understanding Mortgage Rates | dripp inc | Home Equity | Refinancing and Remortgage Guide

Good Morning,

We hope you had a wonderful holiday weekend and are ready to tackle the first week of September.  Some people are coming back from vacation (like me), some are starting college and some are completing home improvement projects.

We have another big economic calendar ahead.  Here is what’s on the agenda.  Stay tuned today and throughout the week, especially Wednesday and Friday because I expect the most interest rate movements then.  Right now plummeting oil prices may stir a stock market rally and increase interest rates.

TUESDAY - Institute for Supply Management (ISM): Measures employment, production, new orders, supplier deliveries, and inventories for more than 300 manufacturing firms.  It gives a very detailed look at how busy and where things are headed in manufacturing sector of the economy.  Current Forecast: 49.5

WEDNESDAY - July’s Factory Orders: Measures new orders for durable and non-durable goods at the dollar level.  If the actual results differ greatly from the expected results we should see more volatility again.  Current expectations are showing a rise in orders of 0.4%.  If the actual orders increase by less than 0.4% we could see rate go back down again.

WEDNESDAY - Fed’s Beige Book report: Talks about the U.S. economic activity by region.  I do not expect any big surprises here, but you never know what will happen.

THURSDAY - 2nd Quarter Productivity and Costs: This information is released by The Labor Department, which measures employee productivity in the workplace.  If productivity is rising, then it will most likely help mortgage rates.  A decrease could raise fears of inflation and mortgage rates may go up.

FRIDAY - August’s Employment Data from the Labor department: the single most important economic news each month.  Measures unemployment rate and number of jobs added or lost.  Unemployment increasing helps to lower interest rates and a decrease stimulates an increase in interest rates.
Forecast - 5.7% (70,000 jobs expected to have been lost)

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