• Wednesday’s mortgage rates should be close to Tuesday’s early pricing. The bond market is currently down 4/32 (4.13%).

 • Stocks are also posting early losses with the Dow down 118 points and the Nasdaq down 38 points.

 • Yesterday afternoon’s release of the minutes from the December 9-10th FOMC meeting didn’t give us any major surprises. There was much discussion about both the need to support a slowing employment sector and concerns about inflation that stubbornly remains well above their preferred annual pace of 2.0%.

 • Comments made question the clarity of what the Fed plans to do next year due to the uncertainty of how their three cuts this year will affect inflation, especially since most of the recent economic data is possibly unreliable because of the gaps during the government shutdown.

 • Also worth mentioning on the topic is the upcoming makeup of the FOMC committee. The committee actually has 19 members that attend and discuss monetary policy each meeting. However, only 12 members have voting rights. Four voting members come from a rotation of presidents of the Federal Reserve regional banks.

 • This is newsworthy because the four members rotating in next year are known to have been less supportive of this year’s rate cuts than some of the current members. In other words, the voting member demographics will be changing next year, further clouding what the Fed may do in the future.

 • In short, bonds had improved a bit during late morning and early afternoon trading yesterday, before the minutes were released. There was little reaction to the 2:00 PM ET release, meaning we are labeling the minutes as neutral for mortgage rates.

 • Last week’s unemployment update was posted this morning instead of the traditional Thursday release because of tomorrow’s holiday. It revealed 199,000 new claims for jobless benefits were filed last week, down from the previous week’s revised 215,000 initial filings and short of the 218,000 that was expected. This signals strength in the employment sector.

 • We have an early close in the bond market today. Trading will stop at 2:00 PM ET while stocks will trade a full session. All markets will be closed tomorrow for the New Year’s Day holiday and will reopen Friday morning for a full day of trading.

 • Friday will likely be a thin or light day because many market participants will be home for the extended holiday weekend. Thin trading simply means a move in either direction shouldn’t be something to be concerned or happy about since it likely will be corrected when the markets have full staff again Monday.

 • Since there is no relevant data tomorrow and the markets are closed for the day, we will not be updating this report.

We would like to take the opportunity to wish you and yours a wonderful and safe New Year holiday!

 

 • Visit our Daily Commentary page on our site for detailed explanations on current news that is relevant to mortgage rates.

 

 

 

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If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.