The mortgage update below is courtesy of Ed Brehm of Prospect Mortgage. In short, mortgage rates are currently at level that bodes well for the real estate marketing, and there was no change last week.
Comments from central bankers have been the driver of mortgage rates over the past few weeks, but there was little new information this week. The recent economic data had offsetting effects on mortgage rates. As a result, mortgage rates ended the week unchanged, remaining near the best levels of the year.
Concerns about the pace of global economic growth have been a big factor spurring central bank action and helping to keep mortgage rates low. Slowing growth in China has been one of the largest reasons for those worries. Most of the economic data out of China in recent months has fallen short of expectations. Wednesday’s trade data was an exception, however, as Chinese exports showed gains for the first time in nine months.
The upside surprise in the Chinese data likely would have pushed mortgage rates a bit higher, but it was offset by Wednesday’s weaker-than-expected U.S. retail sales report. March retail sales, excluding the volatile auto component, posted a nice improvement, but it fell short of expectations.
Since consumer spending is an important component of gross domestic product (GDP) — the broadest measure of U.S. economic growth — the retail sales data is one of the most significant reports each month. The current estimate from the Fed for the first-quarter GDP data to be released April 28 is that there was essentially no GDP growth in the first quarter. The improvement in retail sales in March bodes well for better GDP growth in the second quarter.
Source: MBS Quoteline
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