Mortgage Market Update
Mortgage Market Update-December 9, 2013
While there remains no progress on the ongoing fiscal cliff talks, there is plenty of other news that is impacting the markets. This week, the jobs report came out and wasbetter than expected, the European Central Bank (ECB) kept rates the same and consumer sentiment tumbled to August levels. In addition, manufacturing fell to the lowest numbers since July of 2009.
Many consumers recall what happened last year during the debt ceiling debates and the turmoil in the markets. Unfortunately, the fiscal cliff talks are having a similar impact on the market with traders holding their collective breath each time Speaker Boehner and President Obama speak. There is still wide-spread optimism that a deal will be reached by 12/31 in spite of the fact that talks seem to be going no-where in a hurry. Even if a deal is struck on the fiscal cliff between Congress, the Senate and the White House, it is important to note that the debt ceiling debate will swallow up some oxygen as the debt ceiling will be reached in late February.
The job market numbers
There was a great deal of speculation that the job market would suffer as a result of poor reporting from New Jersey and New York following Hurricane Sandy. However, it appears that this pessimistic view which forecast an increase in the unemployment rate to 8 percent was wrong. In fact, the jobs report showed 146,000 new jobs created during November with the unemployment rate dropping to 7.7 percent. It is important to note however that September and October job numbers were revised downward and that much of the “positive” movement was due largely in part to people leaving the job market versus getting new jobs.
December is a slightly sleepy month for the markets outside of investors who are realigning their portfolios for tax purposes. This week, the mortgage rates slipped slightly, inmost cases down a couple of basis points. However, it is important to note that Operation Twist, is scheduled to end at the end of the year: This is the program that was designed by the Fed to purchase short-term bonds and replace them with longer term bonds. The Fed is widely expected to continue some form of this program into 2013.
As the markets react to the fiscal cliff talks and the pending debt ceiling debate, consumers are not seeing a lot of easing in mortgage rates. With so many potential pitfalls, Core Mortgage Financial is encouraging home buyers or those who are interested in refinancing to consider locking in their interest rates. Since there is no guarantee that Congress and the Senate will act responsibly on both the fiscal cliff and debt ceiling debates, consumers need to protect themselves from the ongoing Washington foolishness. Contact us today about your mortgage lending options!
Disclaimer: Mortgage Market update is for December 3-7, 2012. This article is for informational purposes only. The mortgage market update should not be used for rate lock guidance.