What's Ahead For Coastal Delaware Mortgage Rates This Week: March 18th, 2013
Last week's positive employment reports were good news for the economy, which typically causes mortgage rates to rise, but mortgage rates in Coastal Delaware ended the week lower.
As of Thursday, Freddie Mac reports that the average mortgage rate for a 30-year fixed rate mortgage was 3.63% and the 15-year fixed was 2.79%...with borrowers paying their own closing costs and 0.8% in discount points in either program. The average for 30-year fixed in Coastal Delaware was 3.67% with the 15-year fixed at 2.79%.
Strong Retail Sales Show Consumer Confidence Improving
In other economic news, retail sales for February surpassed Wall Street expectations and grew by 1.1 percent against predictions of 0.5 percent and January's reading of 0.1 percent.
Retail sales account for 70 percent of the U.S. economy and growing retail sales are a strong indicator of economic recovery, which generally causes mortgage rates to rise as bond prices including Mortgage Backed Securities fall. With this strength in the retail sector, it may be a good time to consider locking interest rates for purchase and refinance transactions.
Results of Treasury auctions held Tuesday, Wednesday and Thursday were mixed.
Tuesday's auction of 3-year notes saw average demand, Wednesday's auction of 10-year notes was strong, and Thursday's auction of 30-year bonds drew a weak response.
Financial Reporting Strong Across Multiple Indices
The Producer's Price Index (PPI) for February met expectations at 0.7 percent and exceeded January's level of 0.2 percent.
The Consumer Price Index (CPI) for February came in at 0.7 percent and exceeded expectations of 0.5 percent and January's reading of 0.0 percent. The Core CPI, which excludes food and energy sectors, demonstrates the impact of high fuel prices on the CPI with its lower numbers. The Core CPI for February is 2.0 percent higher than for February 2012.
Upcoming Federal Reserve Meeting May Bring Interest Rate Changes
Next week, the Federal Reserve will meet on Wednesday; investors will be waiting to see how the Fed responds to recent positive economic news in terms of potential changes to its bond purchase program, which is helping to keep mortgage rates lower. The Federal Reserve is not likely to modify its bond purchase program until the inflation rate reaches 2.5 percent
As the deadline of March 27 for funding the Federal government approaches, investors will be following legislative talks to see how or if funding will be approved by the deadline.
Originally posted at Mann & Sons, Inc. REALTORS® - Rehoboth Beach Real Estate Blog