Daily Rate Lock Advisory

Indexes Affecting Rate Lock

High

Neutral

Inflation News

This morning’s big economic news came from the release of August's Personal Income and Outlays report at 8:30 AM ET. The Personal Consumption Expenditures (PCE) indexes in this report revealed inflation rose a little, but didn’t reveal any surprises. August’s overall PCE was up 0.3% last month while the more important core data that excludes volatile food and energy costs rose 0.2%. On an annual basis, the overall reading rose 0.1% from July’s level to stand at a 2.7% year-over-year rate. The core PCE remained at July’s 2.9% annual rate. All four readings pegged forecasts. Bonds would have preferred to see declines, signaling inflation is easing. However, the lack of stronger than expected readings can be considered a small victory.

Medium

Negative

Personal Income and Outlays

Today’s early report also showed personal income rose 0.4% last month and spending was up 0.6%. Both numbers are 0.1% higher than what analysts were expecting to see. Since higher income gives consumers the ability to spend more, fueling economic growth, this part of the report is bad news for bonds and mortgage rates. The inflation readings carry the most significance in this report though.

Medium

Positive

Univ of Mich Consumer Sentiment (Rev)

September’s revised Index of Consumer Sentiment from the University of Michigan concluded this week’s economic calendar. They announced a revised reading of 55.1 that was a bit lower than the initial estimate of 55.4 earlier this month. Lower levels of consumer confidence often lead to softer consumer spending numbers as consumers grow wary of their personal financial situations. Accordingly, we can label this revision favorable for bonds and mortgage rates.

Medium

Unknown

Fed Talk

There also is a Fed-member speaking engagement that we will be watching this afternoon. Fed Vice Chair Bowman is participating in an open conversation at The Cornell Club of New York at 1:00 PM ET. The topic is listed as Approach to Monetary Policy Decision-Making. This leads us to believe we may get some comments related to the current position the Fed is in and how she feels it may be handled.

High

Unknown

Employment Situation

Next week begins Monday with no relevant economic data for the markets to digest, but there is another large batch of Fed speeches scheduled throughout the day. Data releases begin Tuesday morning and ramp up in importance as the week progresses. We will get the new month reports between Wednesday and Friday that include the ADP private sector hiring data, the ISM manufacturing index and the almighty governmental Employment report. It will be another active week for the markets, especially the middle and latter days. Look for details on all of next week’s activities in Sunday evening’s weekly preview.

Rate Lock Advisory

Mortgage Rate Trend

Indexes Affecting Rate Lock

Inflation News

Personal Income and Outlays

Univ of Mich Consumer Sentiment (Rev)

Fed Talk

Employment Situation

Float / Lock Recommendation