Rate Lock Advisory

Monday, March 8th

Monday’s bond market has opened in negative territory following some overnight weakness. Stocks are starting the week mixed with the Dow up 202 points and the Nasdaq down 30 points. The bond market is currently down 5/32 (1.59%), but another late rally Friday should allow this morning’s mortgage rates to be approximately .125 - .250 of a discount point lower than Friday’s early pricing. If you saw an intraday improvement Friday afternoon, you may see a small increase this morning.



30 yr - 1.59%







Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock




There is no relevant economic data or other influential events scheduled for today or tomorrow. The rest of the week has only three reports that we will be watching, in addition to a couple of Treasury auctions. All of the data and auctions will take place the mid and latter days, meaning we should see the most movement in rates those days.



Bond Trends

Inflation is the theme of the week with two indexes scheduled that track inflationary pressures at the consumer and manufacturing levels of the economy. Since the pandemic started, inflation hasn’t been much of a concern due to the economic shutdown. Now that restrictions have been lifted in many states and a new round of stimulus looks to be coming soon, the topic is in the forefront. Higher inflation levels make a bond’s future fixed interest payments less valuable today, causing traders to sell them at a discount to offset that loss. That translates into higher yields and mortgage rates. This is why bonds are sensitive to inflation-related data.



Treasury Auctions (5,7,10,20,30 year)

The Treasury auctions taking place will give us an indication of demand for long-term securities that can also relate to mortgage bonds. Strong demand from investors shows confidence in longer-term securities and should help boost mortgage bonds that also fall into that category. The results of these sales come at 1:00 PM on auction days, making them afternoon events Wednesday and Thursday.




Overall, the inflation reports will draw plenty of attention this week. Wednesday looks to be the most important day of the week due to the CPI release and the 10-year Note auction while tomorrow may be the calmest day for rates unless something unexpected happens. However, as we saw last week, the markets can get active at any time without notice. Therefore, keep a close eye on them if still floating an interest rate and closing in the near future.

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Float if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

Avalon Mortgage Services, Inc. an Illinois Residential Mortgage Licensee

NMLS#:283614 Illinois license#: MB.0003198

9439 West 144th Place
Orland Park, IL 60462-2543