Economic Calendar: What may move Mortgage Rates this week; July 13, 2009

I AM BACK! I spent last week in a tent with my Boy Scout Uniform on. I am back to the world of Flush Toilets, AC, Electricity, Starched shirts and WORK....

Well, it is a pretty busy week of data, but the past few weeks have been good ones, there has been quite a bit of improvement in mortgage rates in the past 14 days or so... How much better? well from the highs we saw we are probably about 1/2-3/4% lower now than we were just a month or two ago as we saw interest rates spike up on us. That cant be bad news?

Here is what we have in store for this week:

• Monday: No News day. So far the day has been a mixed bag of ups and downs. The market is actually off slightly as I type this, but I wouldn't doubt it goes back to even by time I am done, that's just the way today has been.
• TuesdayJuly 14: June PPI expected +0.9% with a core of +0.1%. If you drive a car you know that the price at the pump jumped quite a bit last month. that is why there is such a big difference in the headline number vs the core. a modest core PPI number is "OK" for rates and would most likly support steady rates.
• Tuesday: June Retail Sails expected +0.4% ex Auto +0.5%. As forecast this will likely cause steady to possibly lower rates. If there is some surprise strength it will be bad news, but that is not likely.
• Tuesday: May Business Inventories expected -0.8%. ZZZZ its a boring old news number that the market will not look at.
• Wednesday, July 15: June CPI expected +0.6% with a core of +0.1%. I could almost cut and paste PPI comments here. As forecast we will see stable rates.
• Wednesday: June Industrial Production and Capacity Utilization expected -0.6% and 67.9%. Inventory has been falling as business are less likely to tie up cash in "stuff" at some point this decline will cause more orders and higher production in the future, for now this is not a market mover.
• Wednesday: Fed releases the minutes of the 6/24 meeting. This report will be torn apart, scoured and digested for sure, all in an effort to try to read between the lines as to when the FED may see the need to raise rates. The Post Meeting Statement did not paint a clear picture of the Fed's long term view of the economy. The Fed is great at "fed speak" so it is not likely there will be any new clues here.
• Thursday July 16: Initial jobless claims expected up 10,000. This number has remained high for most of this year, bordering on the ugly. But it is not anything that is a surprise.
• Friday, July 17: June Housing starts and Building permits both expected to be unchanged. Analysts are predicting a bottom in new home construction. It is not likely we will see a rebound next month, but we will probably see a few more "unchanged" months prior to any improving figures. Once there is improvement it would be bad for long term interest rates.

Well that all sounds like a lot! But reality is it is not too much to worry about. The potential biggie of the week is the Retail Sales number... Far off the mark on either side of the forecast number and this is the one number with the most potential to move the market. Nothing really to worry about because the forecasts are usually pretty accurate. The retail number is the most important since the consumer accounts for about 70% of the economy, so what they are doing is HUGE to the markets.

My best educated guess is that we will see steady to slightly improving rates by weeks end.

That's this weeks two cents! Have a great week!

Rob

Robert Rauf

Mortgage Banker

www.RobertRaufHomeLoans.com or my blog: http://activerain.com/blogs/rrauf

(732)223-1630 x102

Since 1987 I have been helping my clients fulfill their dream of home ownership!

Real Estate Mortgage Network

NJ Mortgages, New Jersey Mortgages, Mortgages in NJ, mortgage in New Jersey, Mortgages in New Jersey