FRM Update

July 16, 2018



MBS spreads remained stable to both Treasuries and Swaps this week. The yield curve continued its flattening trend with 2s/10s opening at 28bps and closing 3bps lower at 25bps, which is the lowest level since 2007.

The average rates on 30-year fixed and 15-year fixed mortgages remained relatively stable during the past week.  Meanwhile, mortgage applications reversed course and increased 6.5% from one week earlier. Despite total applications rising, the refinance index decreased 4.0% from the week earlier with the index remaining below 1000.  This is the lowest level of refinance activity since December 2000.

 

Activity picked up last week with investors focusing on the following:

 





Mortgage Rates and Refinance Activity

 

 

Housing:

Mortgage Applications: Mortgage applications for the week ending July 6 rose 2.5% on a 6.5% gain in purchase apps and a 3.8% decline in refi apps.  Mortgage rates have pulled back fractionally over the past two weeks with the 30-year mortgage rate falling from 4.39% to 4.37%.  While this is hardly enough of a move to elicit an increase in mortgage activity, the strength in purchase activity remains apparent and points to a short-term bump of approximately 5% for home sales.

 

 

 

 

 



Michael S. Erhardt, CPA

Senior Vice President

Investment Strategist

Vining Sparks, IBG

INTENDED FOR INSTITUTIONAL INVESTORS ONLY.
The information included herein has been obtained from sources deemed reliable, but it is not in any way guaranteed, and it, together with any opinions expressed, is subject to change at any time. Any and all details offered in this publication are preliminary and are therefore subject to change at any time. This has been prepared for general information purposes only and does not consider the specific investment objectives, financial situation and particular needs of any individual or institution. This information is, by its very nature, incomplete and specifically lacks information critical to making final investment decisions. Investors should seek financial advice as to the appropriateness of investing in any securities or investment strategies mentioned or recommended. The accuracy of the financial projections is dependent on the occurrence of future events which cannot be assured; therefore, the actual results achieved during the projection period may vary from the projections. The firm may have positions, long or short, in any or all securities mentioned. Member FINRA/SIPC.
Copyright © 2021
Member FINRA/SIPC
This is a publication of Vining-Sparks IBG, L.P.
775 Ridge Lake Blvd., Memphis, TN 38120