In The News
Morning Report: This Week In The Market
December 13, 2009 by Wesley Ledford · Leave a Comment
Mortgage bond prices were near unchanged last week holding mortgage rates steady. Trade was extremely volatile with wide swings common.
The Treasury auctions were not as well received by foreign accounts as traders were hoping. The US relies on foreign central banks such as China to fund our deficit spending. If China were to decrease or cease purchasing US bonds and notes, rates would rise.
The inflation data will be the most important releases this week. Inflation erodes the value of fixed income securities causing prices to fall and rates to rise. The Fed meeting will also take center stage. While no rates changes are expected the wording of the release will be very important.
Here are the reports, and when they are released.
LOOKING AHEAD
| Economic Indicator |
Release Date and Time |
Consensus Estimate |
Analysis |
| Producer Price Index | Tuesday, Dec. 15, 8:30 am, et |
Up 0.9%, Core up 0.2% |
Important. An indication of inflationary pressures at the producer level. Weaker figures may lead to lower rates. |
| Industrial Production | Tuesday, Dec. 15, 9:15 am, et |
Up 0.6% | Important. A measure of manufacturing sector strength. A lower than expected increase may lead to lower rates. |
| Capacity Utilization | Tuesday, Dec. 15, 9:15 am, et |
71.1% | Important. A figure above 85% is viewed as inflationary. A decrease may lead to lower mortgage interest rates. |
| Housing Starts | Wednesday, Dec. 16, 8:30 am, et |
Up 8.6% | Important. A measure of housing sector strength. Weakness may lead to lower rates. |
| Consumer Price Index | Wednesday, Dec. 16, 8:30 am, et |
Up 0.7%, Core up 0.1% |
Important. A measure of inflation at the consumer level. Lower than expected increases may lead to lower rates. |
| Fed Meeting Adjourns | Wednesday, Dec. 16, 2:15 pm, et |
No rate change | Important. Few expect the Fed to raise rates, but some volatility may surround the adjournment of this meeting. |
| Leading Economic Indicators | Thursday, Dec. 17, 10:00 am, et |
Up 0.7% | Important. An indication of future economic activity. A smaller increase may lead to lower rates. |
| Philadelphia Fed Survey | Thursday, Dec. 17, 10:00 am, et |
16.5 | Moderately important. A survey of business conditions in the Northeast. Weakness may lead to lower rates. |
