George L. Duarte

Mortgage Loans Fremont California Horizon Financial Associates

  • Home
  • About
    • About
    • Awards
    • Privacy Policy
    • California Privacy Notice
    • Accessibility Statement
  • Reverse Mortgage Library
  • Resources
    • Real Estate Corner Radio Show
    • VA Loans
    • Home Appraisal
    • Home Inspection
    • Loan Checklist
    • Loan Process
    • Loan Programs
    • Mortgage FAQ
    • Mortgage Glossary
    • Closing Costs
    • Living Trusts
  • Reviews
    • Video Testimonials
    • Reviews
    • Write a Review
  • Apply Now
  • Contact

What’s Ahead For Mortgage Rates This Week – April 18, 2016

April 18, 2016 by George Duarte

What's Ahead For Mortgage Rates This Week - April 18, 2016

Last week’s scheduled economic releases included reports on retail sales, inflation and the Federal Reserve’s Beige Book report. Weekly reports on mortgage rates and new jobless claims were also released. The Consumer Financial Protection Bureau announced a limited program for reducing principal on eligible mortgages held by Fannie Mae and Freddie Mac. This program is intended to resolve remaining “underwater” mortgages on homes worth less than their current mortgage amounts.

Retail Sales Fall, Inflation Rises

Retail sales fell in March to close out a weaker than expected first quarter 2016. Retail sales fell 0.30 percent in March as compared to expectations of a 0.10 percent increase and February’s flat reading. Analysts said consumers were reluctant to spend in spite of improving job markets and household finances. Retail sales rose by 1.70 percent year-over-year, a reading categorized as “weak” by analysts.

Hiring for lower wages and fewer hours worked was seen as contributing to consumers’ reluctance to spend, especially on big-ticket items including vehicles. Retail sales excluding auto sales were 0.20 percent higher than in February, but did not meet the expected reading of 0.50 percent and incrementally exceeded February’s reading, which was unchanged from January.

Inflation rose by 0.10 percent in March against expectations of 0.20 percent and February’s negative reading of -0.70 percent. Core inflation readings that exclude volatile food and energy sectors mirrored the Consumer Price Index with 0.10 percent growth against an expected reading of 0.20 percent and February’s Core Consumer Price Index reading of 0.30 percent. Lagging inflation is largely attributed to lower fuel prices, but this doesn’t impact the Core CPI reading.

Fed Beige Book: Economy Recovering at Modest to Moderate Rate

According to the Federal Beige Book report for March, business contacts surveyed by the Federal Reserve suggested that increases in wages and oil prices should bump up the economy, but the Fed expects economic expansion to increase at a “modest to moderate” rate for the long term. Employers noted difficulties in hiring for low and high skilled jobs in some areas, and retailers were optimistic about sales for the rest of 2016.

In general, the Fed has adopted a cautious approach to raising its target federal funds rate. Fed Chair Janet Yellen repeatedly cited concerns over global risks for scaling back Fed rate increases from four to two in 2016.

Mortgage Rates, Jobless Claims Fall

Freddie Mac reported the lowest mortgage rates for 2016; rates were also their lowest since May 2013. The average rate for a 30-year fixed rate mortgage fell one basis point to 3.58 percent; the average rate for a 15-year fixed rate mortgage fell two basis points to 2.86 percent. The average rates for a 5/1 adjustable rate mortgage also slipped two basis points to 2.84 percent. Discount points were 0.50, 0.40 and 0.50 percent respectively.

In unrelated mortgage news, the Consumer Financial Protection Bureau announced a limited program for reducing mortgage balances for eligible mortgages owned by Fannie Mae and Freddie Mac that exceed home values. Mortgage lenders will notify eligible homeowners by December 31.While limited in scope, this program is expected to prevent foreclosure of eligible properties that cannot be sold or refinanced.

Jobless claims fell to 253,000 new claims last week, which was lower than the expected reading of 270,000 new jobless claims and the prior week’s reading of 266,000 new claims. Coupled with the Beige Book findings that employers are facing shortages of qualified workers, this low reading appears to further support improving economic conditions.

What‘s Ahead

Next week’s scheduled economic releases include the National Association’s Home Builders Housing Market Index along with Commerce Department reports on housing starts and building permits. The National Association of Realtors® will also release its Existing Home Sales Report.

Filed Under: Financial Reports Tagged With: Case Shiller, Financial Reports, Mortgage Rates

Sidebar View Lending Cert
NAMB Member Cert
Apply Now!
Mortgage Refinance Companies
NAMB
Veterans VABA Member
CMC Logo

Follow My Posts and Sign Up for My Newsletter!

Download Our App!



Horizon Financial Associates BBB Business Review

Connect with Me

Recent Awards

Mortgage Pros
2019 Best of Fremont 2017 Best of Fremont 2016 Best of Fremont
See More Awards →

Browse Articles by Category

Recent Articles

  • 5 Tips for Crafting a Counter-offer That Doesn’t Scare Away a Potential Home Buyer
  • What’s Ahead For Mortgage Rates This Week – March 27, 2023
  • 3 Things That Will Absolutely Kill Your Chances for a Mortgage Approval
  • Mortgage Interest Rate Versus APR: What To Know
Horizon Financial Associates is a BBB Accredited Mortgage Broker in Fremont, CA
Equal Housing Opp
CRB Logo REALTOR logo

Our Location


39488 Stevenson Pl
Fremont, CA 94539

Copyright © 2023 · Powered by MySMARTblog