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September's Industrial Production data was released at 9:15 AM ET this morning. It showed a 0.3% rise in output at U.S. factories, mines and utilities, matching expectations. Because it showed no surprises, the news had had little impact on this morning's mortgage rates.
Tomorrow has two events scheduled that have the potential to influence mortgage rates. The first is September's Housing Starts at 8:30 AM ET. This Commerce Department report will probably not have much of an impact on the bond market or mortgage rates. It gives us a measurement of housing sector strength and future mortgage credit demand by tracking construction starts of new homes, but is usually considered to be of low importance to the financial and mortgage markets. It is expected to show a drop in new home starts between August and September. We likely will need to see a significant surprise in this data for it to have a direct impact on mortgage rates.
The second will come during afternoon trading when the minutes from last month's FOMC meeting will be posted. These may move the markets or could be a non-factor, depending on what they show. The key points traders are looking for are concerns over economic growth here and globally, inflation and the Fed's next monetary policy move (rate hike). It is worth noting though that the last FOMC meeting was followed by revised economic predictions and a press conference with Fed Chair Powell. Therefore, the likelihood of seeing a significant surprise in the minutes is relatively low. The minutes will be released at 2:00 PM ET, meaning of there is a reaction in the markets it will come mid-afternoon.
©Mortgage Commentary 2018