| Last | Change | Percent | |
| S&P Futures | 1591.2 | -1.0 | -0.06% |
| Eurostoxx Index | 2712.0 | 0.0 | 0.00% |
| Oil (WTI) | 91.87 | -1.6 | -1.70% |
| LIBOR | 0.273 | 0.000 | 0.00% |
| US Dollar Index (DXY) | 81.38 | -0.367 | -0.45% |
| 10 Year Govt Bond Yield | 1.65% | -0.02% | |
| Current Coupon Ginnie Mae TBA | 106.5 | 0.0 | |
| Current Coupon Fannie Mae TBA | 104.7 | 0.1 | |
| RPX Composite Real Estate Index | 192.5 | 0.4 | |
| BankRate 30 Year Fixed Rate Mortgage | 3.43 |
Markets are slightly weaker ahead of the FOMC announcement later today. MBA mortgage applications increased 1.8% last week. The Markit Flash Manufacturing Purchasing Managers Index came in at 52.1, indicating that business conditions for manufacturers are more or less in line with historical trends. Bonds and MBS are up.
The ADP employment change (which is a forecast for Friday's jobs report) came in lower than expected at 119,000. March was revised downward as well. Lately the ADP employment change has not been all that great or a predictor of the official jobs report, but we'll see.
The FOMC's rate decision is expected to be released at 2:00 pm EST. Nobody expects any change in interest rates - the big question will be regarding asset purchases or QE. Late last year, there appeared to be a consensus that QE would end sometime this year. Subsequent comments from Federal Reserve governors however seemed to contradict that view. Now, we have some that have mentioned the possibility of additional measures. If anything that probably points to a "steady as she goes" type of statement, but we'll see.
Looks like Ed DeMarco is out at FHFA and Mel Watt is in. This probably means principal mods for conforming mortgages are on the way. Interestingly, Watt represented the Charlotte district, the same district as Bank of America. Principal mods are not a slam dunk however - the biggest MBS holders are pension funds and they are struggling to meet their obligations in this low interest rate environment. Watt's confirmation will not be a slam dunk by any means.
The homeownership rate declined to 65% in Q1, the lowest level since 1995. This speaks to the absolute dearth of household formation numbers in the last 5 years. While the number has dropped significantly from its peak in 2005, it is still more or less at historical averages.
Chart: Homeownership rate
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