Thursday’s bond market has opened relative flat despite the release of weaker than expected economic news. The stock markets are showing gains with the Dow up 42 points and the Nasdaq up 9 points. The bond market is currently up 1/32, which will likely keep this morning’s mortgage rates at yesterday’s levels.

 

The Commerce Department reported this mornin g that the Gross Domestic Product (GDP) rose at a 5.3% annual pace during the first three months of the year. This was an upward revision to the initial reading of 4.8%, but was much lower than the 5.8% that was expected. This is good news for the bond market and mortgage rates because the slower than expected economic growth may ease inflation concerns.

 

Also posted this morning was April’s Existing Home Sales numbers. The National Association of Realtors said that home resales fell 2.0% last month. This was close to analysts forecasts and has not had an impact on this morning’s mortgage pricing.

 

Tomorrow brings us the release of two important reports. The first is April’s Personal Income and Outlays data at 8:30 AM. This report gives us an indication of consumer ability to spend and current spending habits. An increase in income means that consumers have more money available to spend. Since consumer spending makes up two-thirds of the U.S. economy, this da ta can cause movement in the financial markets and mortgage rates. Current forecasts are showing a 0.7% rise in income and a 0.6% increase in spending.

 

The second report of the day and the last important data of the week will come from the University of Michigan who will update their Index of Consumer Sentiment for May. An upward revision may lead to slightly higher mortgage rates, while a downward change may help push rates slightly lower. The preliminary reading was 79.0

 

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… Float 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.

a la mode