Loan Officer | NMLS #341095
Branch NMLS #1647193
Posted On September 11, 2017
Mortgage rates are trending downward and mortgage application submissions are up. Homeowners and home buyers are looking to lock rates ahead of the Federal Open Market Committee (FOMC) policy meeting next week. This week, the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) comes out on Tuesday, the Mortgage Bankers Association (MBA) mortgage application survey comes out on Wednesday, and the Consumer Price Index comes out on Thursday.
The Labor Department’s JOLTS reports on changes in job openings, hirings, and voluntary quits. In a healthy labor market, workers are confident that they will find gainful employment if they quit their current position. In June, there were 6.163 million job openings. The report lags by one month, but is still used to judge the health of the labor market.
The MBA mortgage application survey tracks changes in new purchase and refinance applications. Following Hurricane Harvey, mortgage rates dropped, and mortgage applications reacted. New purchase applications increased 1.0% and refinance applications increased 5.0% for a composite gain of 3.3%. The FOMC is scheduled to meet later this month, and if they vote to raise the benchmark interest rate, mortgage rates will increase.
The consumer price index measures changes in the cost of a fixed basket of goods and services. Inflation can lead to an increase in overall prices. In August, the consumer price index increased 0.1% month-over-month and 1.7% year-over-year. Due to the impact of Hurricane Harvey, energy prices are expected to increase this month.
The southeastern United States has been coping with significant damage from Hurricane Harvey in Texas and Louisiana and Hurricane Irma in Florida, Georgia, and Alabama. Due to these events, some analysts believe the FOMC will hold back on hiking rates this month, and wait until December to raise rates again.