Forecast for the Week

A full slate of economic reports is ahead, plus the Fed meets!

• On the housing front, look for the S&P/Case-Shiller Home Price Index on Tuesday and Pending Home Sales on Wednesday.
• Consumer Confidence will be reported on Tuesday, followed by the Consumer Sentiment Index on Friday.
• On Wednesday, Gross Domestic Product will give us an important read on the U.S. economy during the first quarter of 2015.
• Look for news from the manufacturing sector via the Chicago PMI on Thursday and the ISM Index on Friday.
• The Fed’s favorite measure of inflation, Personal Consumption Expenditures, will be released on Thursday, along with the Employment Cost Index, Weekly Initial Jobless Claims, Personal Income and Personal Spending.

In addition, the Fed meets this week, with the Monetary Policy Statement due to be released on Wednesday. Investors will be listening closely for any hints as to when the Fed may raise the Fed Funds Rate (the rate banks charge each other to lend money overnight), and this news could lead to volatility in the markets.

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 on which home loan rates are based.

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, Mortgage Bonds remain in a tight trading range. Home loan rates are hovering near record lows.

Chart: Fannie Mae 3.0% Mortgage Bond (Friday April 24, 2015)

The Mortgage Market Guide View…

Alert: Facebook Video Scam

A “malicious tagging” scam is making its way around Facebook, putting multiple operating systems and devices at risk, including computers, smartphones and video game systems.

How It Works
A post appears in your Facebook news feed that seems to link to a funny video. This link will look like it is tagged by 20 of your friends to dupe you into thinking the link is safe. However, once you click on the video, a second link pops up saying the video cannot be played without updating your Adobe Flash Player. If you click the second link to download the update you will download malware, giving hackers access to your logins and personal data.

NOTE: A variant of this scam sends you to download a Chrome or Firefox browser video plugin.

How to Protect Yourself
First, never accept system or software updates from third party links like pop-ups on social networks or web pages. If you suspect your Adobe Flash Player or other software may be out of date, go directly to the developer’s website and download it.

Second, ask yourself if your friends or associates would post this material, and if they know each other well enough to be tagged on the same feed. Also, make sure you have anti-malware installed on your machine: AVG (freeware) or McAfee (subscription) are two options. But beware that even if you have this protection, being judicious with the links you click is the best policy.

Finally, adjust your Facebook privacy settings to ask permission to display content you’re tagged in. This will limit the spread of scams in case you do fall prey to one. Simply set the Timeline Review option in your Facebook Privacy Settings.

As always, feel free to pass these helpful tips along to your team, clients and colleagues!

Sources: Bottom Line, HotforSecurity.com

Economic Calendar for the Week of April 27 – May 1

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