⏱ THE MORTGAGE MINUTE

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GDP Release Tomorrow at 5:30 AM – Lock Strategy Update

Tomorrow's GDP report is expected to be a significant market mover. Consider locking some of your pipeline today to hedge against the potential for a sharp increase in the 10-year Treasury, which could increase mortgage rates tomorrow.

Key Considerations:

• Timing Risk: Rates won’t be available early tomorrow morning as the GDP data is released, so locking today could protect against upward volatility.

• Market Sentiment: We anticipate a lower-than-expected GDP reading, pushing rates down. However, rates are currently at a resistance level. If GDP surprises us and comes in strong, rates could spike upwards sharply, possibly moving 20-30 basis points within the day.

If you're satisfied with the rate and comp on a file, it might be wise to lock it today to mitigate risk. Tomorrow could bring significant volatility, so keep a close watch.

Looking Ahead – Core PCE on Friday at 5:30 AM

While tomorrow’s GDP report will be important, Friday's Core PCE release could be an even larger market mover.

Core PCE is the Fed's preferred measure of inflation, and a stronger-than-expected reading could lead to increased expectations for pausing rate cuts - which would claw back some of the recent rate market gains.

Conversely, a softer reading might provide some continued downward relief in rates.  Market sentiment suggests that the Core PCE will come in at or below expectations, reducing interest rates. 

We wouldn’t risk your entire pipeline on it, though!