Consumer Price Index (CPI)

December 15th, 2016

Commentary:  With MBS continuing in the downward spiral and no bottom to be found yet.  Hopefully the further we fall the higher we bounce back.

 

WRAP: MBS fell again today as the Fannie Mae 30-yr 3.5% coupon has now lost 500bp since the presidential election. We will be switching to the 4% coupon in 2-3 business days. The Bond lost 38bp to end at 101.06 as it has sliced through all kinds of support like they were melting butter. Investors continue to pull out of Bonds and into riskier assets. The Dow gained 59.71 points to 19,852.24, the S&P was up 8.75 points to 2,262.03, while the Nasdaq rose 20.18 points ti end at 5,465.85. WTI oil closed at $50.90/barrel, near unchanged. 10-yr T Note yield 2.60%. Housing Starts and Building Permits will be released tomorrow.

What is the 'Consumer Price Index - CPI'

The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. It is calculated by taking price changes for each item in the predetermined basket of goods and averaging them. Changes in the CPI are used to assess price changes associated with the cost of living; the CPI is one of the most frequently used statistics for identifying periods of inflation or deflation.

 

Today's Agenda

Date & Time of ReportReportForEstimateActualPriorImpact
12/15/2016 8:30:00Consumer Price Index (CPI)Nov0.20%0.20%0.10%High
 Core Consumer Price Index (CPI)Nov0.20%0.20%0.10%High
 Philadelphia Fed indexDec921.57.6High
 Empire State IndexDec391.5Moderate
 Jobless Claims12/10256K254K258KModerate
12/15/16 10:00 AMHousing Market IndexDec63 63Moderate

Tomorrow's Agenda

12/16/2016 8:30:00Housing StartsNov1225K 1323KModerate
 Building PermitsNov1236K 1229KModerate

What Is Going On With Interest Rates?  #wigowir

 

Below is the news when it happened and the market’s reaction.  For a full view of the day start at the bottom and work your way up. If want to know what just happened start at the top. All Times are Eastern Standard Time.  When the price of Mortgage Backed Securities (MBS) goes down rates go up, and when the price goes up rates come down. Remember in the bond market Bad News is Good News and Good News is Bad news.

 

4:00 PM MBS continue in their downward spiral.

1:44 PM Past midday, Mortgage Bonds have cut into 1/2 of the early morning losses. Stocks are higher, but below best levels of the session.

12:21 PM MBS are once again trying to rebound for the 2nd time today.

 

11:43 AM Alert To Lock!

11:41 AM Freddie Mac reports that the 30-year fixed conventional mortgage rate hit 4.16% this week with 0.5 in points and fees.

11:23 AM Very volatile environment in MBS as they trade in large fast moves. Early windows could lead to reprice for the worse.

10:57 AM Dow +120 points.

10:04 AM MBS lose some steam after the surge in the NAHB Housing Market Index.

10:01 AM The December NAHB Housing Market Index soars to 70 vs the 63 expected and up from 63 in November ... highest since 2005.

10:00 AM The S&P is trading higher soon after the opening bell on Wall Street.

10:00 AM ET The prices posted below show the significant changes from yesterday at 10:30 AM.

 

9:11 AM Big comeback in Mortgage Bond prices. The 3.5% Fannie Mae 30-yr coupon is up 47bp from the opening lows.

9:04 AM With the rise in rates, we will most likely be switching to the Fannie Mae 30-yr 4% coupon in the next few business days.

8:52 AM The NAHB Housing Market Index will be released at 10:00 a.m. ET.

8:49 AM S&P futures modestly higher as the Fed sees faster pace of rate hikes.

8:48 AM MBS able to bounce off lows.

8:46 AM U.S. dollar index 102.97, +1.20.

8:38 AM WTI oil $50.47/barrel, -$0.58.

 

8:37 AM Weekly Initial Jobless Claims 254K vs 256K expected.

8:36 AM December Philly Fed 21.5 vs 9.0 expected. Empire Manufacturing 9.0 vs 3.0 expected.

8:35 AM November CPI and Core inline at 0.2%.

8:27 AM 10-yr T Note yield 2.61%.

8:26 AM MBS open lower as the fallout from the reflation trade and the hawkish Fed statement lingers on.

Johnmarbury.com has attempted to verify the information contained on this post.  However any aspect of such may change without notice.  Johnmarbury.com does not provide investment advice and does not represent that any of the information or related analysis is accurate or complete at any time. On October 5th we started posting our rates and leaving them on the site for you to refer back to. This will allow  you see where actual rates have been along with the news that caused the fluctuations on the rate sheet.  I ask that you forgive my spelling and grammatical mistakes. This is due writing skills that are lacking and the need to communicate quickly.  Most of the information posted on this blog along with the charts and indexes are available all during the day to the subscrbers of www.themortgagemarketguide.com  The cost of subscription is very reasonable.

 

 

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