MMG Weekly 5/16/16

Guy R. Vetrano NMLS# 183357
Mortgage Loan Originator
Bay Equity Home Loans
Phone: 480.500.6000 x 6017
Mobile: 602-692-7196
E-fax: 602.532.7304
gvetrano@bayeq.com
www.bayequityhomeloans.com/guy-vetrano

In This Issue  

Last Week in Review: Retail Sales heat up. Inflation stays tepid.

Forecast for the Week: Manufacturing, housing and consumer inflation are up for analysis.

View: Not a morning person? Get tips to retrain your body and boost productivity.


Last Week in Review  

“Money burns a hole in my pocket.” Dean Martin. Retail Sales were hot in April as consumers felt the burn to spend.

April Retail Sales posted the biggest increase in a year. The Commerce Department reported April Retail Sales jumped 1.3 percent, above the 0.8 percent expected and up from the -0.3 percent reading in March. U.S. consumers stepped up purchasing a wide range of goods. The Retail Sales report is a measure of total retail store receipts from all sizes and kinds of businesses throughout the nation.

This spending reinforces the surge in Consumer Sentiment, which rose 6.8 points to 95.8, the highest reading since June 2015. Sentiment increased across all income and age groups, with big gains among lower-income and younger households. The optimism is attributed to income gains, employment outlook and the expectation of lower inflation and interest rates.

Meanwhile, wholesale inflation remained tame, and wholesale prices remained flat for the preceding 12-month period. The April Producer Price Index (PPI) rose 0.2 percent versus the 0.3 percent expected, while the Core PPI, which strips out volatile food and energy, was inline at 0.1 percent.

The great news is that home loan rates remain near historic lows, and are hovering at three-year lows.

If you or anyone you know has any questions about home loan products or rates, please give me a call.


Forecast for the Week  

As the Fed zeroes in on regional manufacturing data, housing news and consumer inflation, investors will be eyeing these reports as well as insights from April’s Federal Open Market Committee (FOMC) meeting.
  • Regional manufacturing data kicks off the week Monday with the Empire State Index followed by the Philadelphia Fed Index on Thursday.
  • Housing news is peppered throughout the week with the NAHB Housing Market Index on Monday, Housing Starts and Building Permits on Tuesday, and Existing Home Sales on Friday.
  • Consumer inflation is shared via the Consumer Price Index Tuesday.
  • FOMC meeting minutes are released Wednesday.
  • Weekly Initial Jobless Claims will be released Thursday.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, economic news at home and abroad has kept MBS near historic highs, meaning home loan rates are still near historic lows.

Chart: Fannie Mae 3.0% Mortgage Bond (Friday May 13, 2016)

Japanese Candlestick Chart

The Mortgage Market Guide View…  

4 Tips for Becoming a Productive Morning Person

According to the researchers and authors of the “The Body Clock Guide to Better Health,” only 1 in 10 people can truly be categorized as an early riser, only 2 in 10 can be categorized as night owls, and the rest of us fall (asleep) somewhere in the middle. The good news is each of us can retrain our bodies to rise earlier, and start our workday feeling more refreshed and more productive. If you have trouble with a morning routine, here are four tips to try:

Start off slow. Go to bed 15 minutes earlier than usual and wake up 15 minutes sooner to ease your body into the transition. Once you’ve adjusted, repeat these quarter-hour increment changes until you awake at your preferred time.

You snooze, you lose. When you repeatedly hit the snooze button, you’re not actually getting more sleep. Instead, you’re disrupting physiological waking patterns, and it could cause you to feel more groggy the rest of the day. Place your alarm well out of arm’s reach, so you have to get up to turn it off.

Prepare the night before. Select your clothes, pack your gym bag, plan your breakfast and make your lunch. This will allow you to ease into the morning without rushing to get too many things done at once.

Don’t ignore your stomach. Going to bed too full or too hungry can disrupt sleep. (Likewise, drinking too much liquid can keep you awake, too). See these before-bed snack ideas to keep your stomach satisfied until breakfast.

Want even more ideas? Here are 15 additional ways you can train yourself to be an early riser. Starting each morning off right often hinges on how well you prepare the night before. Make it easier to expend your morning mental energy on productive work. Try these tips for becoming a morning person.

Please feel free to pass these helpful tips along to your team, clients and colleagues.

Sources: Daily Burn, Fitness Magazine, Prevention

Economic Calendar for the Week of May 16 – May 20
Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Mon. May 16
08:30
Empire State Index
May
NA
9.6
Moderate
Mon. May 16
10:00
Housing Market Index
May
NA
58
Moderate
Tue. May 17
08:30
Building Permits
Apr
NA
1086K
Moderate
Tue. May 17
08:30
Housing Starts
Apr
NA
1089K
Moderate
Tue. May 17
08:30
Core Consumer Price Index (CPI)
Apr
NA
0.1%
HIGH
Tue. May 17
08:30
Consumer Price Index (CPI)
Apr
NA
0.1%
HIGH
Wed. May 18
02:00
FOMC Minutes
Apr
NA
NA
HIGH
Thu. May 19
08:30
Jobless Claims (Initial)
5/14
NA
NA
Moderate
Thu. May 19
08:30
Philadelphia Fed Index
May
NA
-1.6
HIGH
Fri. May 20
10:00
Existing Home Sales
Apr
NA
5.33M
Moderate

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As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
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