Updated on June 20, 2018 10:22:09 AM EDT
The National Association of Realtors gave us Mays Existing Home Sales figures late this morning. They announced a 0.4% decline in home resales last month when analysts were expecting to see an increase in sales. Because housing sector weakness makes broader economic growth more difficult, this was favorable for bonds and mortgage rates. However, since this is only a moderately important report, we have not seen a strong reaction in the bond market.
Tomorrow has two economic releases scheduled, starting with last week’s unemployment update. It will give us a measurement of employment sector strength but is not considered to be a key report because it is only a weekly snapshot. Analysts are expecting to see that 220,000 new claims for unemployment benefits were filed last week. This would be a small increase from the previous week’s 218,000 initial filings. Good news would be a large increase as rising claims is a sign of weakness in the sector.
Mays Leading Economic Indicators (LEI) will finish this week’s monthly reports at 10:00 AM ET tomorrow morning. The Conference Board, who is a New York-based business research group, produces this report. The LEI attempts to predict economic activity over the next three to six months. Good news for mortgage rates would be a decline in this index, but it is expected to show a 0.4% increase from Aprils reading. This means it is predicting an increase in economic growth over the next several months. Since this report is not considered to be of high importance, I dont see it causing too much movement in rates regardless if it shows a particularly strong or weak reading.
©Mortgage Commentary 2018