Forecast For The Week
The economic calendar this week will give the investor a broad view of the U.S. economybut the Federal Open Market Committee (FOMC) meeting will be front and center in the minds of investors. Here’s a break down of what to watch:
In addition to those reports, this week’s FOMC meeting will be closely watched by both the Bond and Stock markets for any clues on how the U.S.economy is holding up.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond that home loan rates are based on.
When you see these Bond prices moving higher, it means home loan rates are improving – and when they are moving lower, home loan rates are getting worse.
To go one step further – a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.
As you can see in the chart below, the mix of news last week benefitted Bonds and home loan rates. I’ll be watching closely to see what happens this week.
Chart: Fannie Mae 3.5% Mortgage Bond (Friday Apr 20, 2012)
Fun Housing Facts
The United States Census Bureau recently released some fun facts related to housing across the country, based on data for 2010. Here are just a few highlights from the release that you may find interestingand may want to pass on to others.
Heating Our Homes
From Home to Work
Home Sweet Home
The first housing census in 1940 featured 31 housing questions – including some we may find odd today, such as whether the house had a radio toilets or an outhouse electric lighting and running water.
Conversely, the 2010 census only included two housing questions: (1) whether the home was owned or rented and (2) whether the respondent sometimes lived or stayed somewhere else. The number of housing questions in the census has dropped because we now ask a number of housing questions in the American Community Survey, which is sent to about 3 million households nationwide every year.
Over the years, housing has really changed. But regardless of the time or location, one thing remains the same there’s no place like home!
Economic Calendar for the Week of April 23 – April 27
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