Mortgage bond prices finished the week significantly higher which put downward pressure on rates. Rates improved most days except for Thursday afternoon and Friday morning which saw some heavy selling pressure. The Fed continued their billion-dollar daily MBS purchases which enabled rates to improve overall. The data was mixed. Existing home sales were 6.22M vs the expected 6.55M. Durable goods fell 1.1% which was in line with estimates. GDP rose 4.3% vs the expected 4.1% increase. Weekly jobless claims were 684K vs 730K. Income fell 7.1% vs the expected 6% decline. Spending fell 1% vs an expected 0.3% decrease. Core PCE rose 0.1% as expected. Consumer sentiment was 84.9 vs 84. Mortgage interest rates finished the week better by approximately 5/8 of a discount point.

Looking Ahead
Economic IndicatorRelease Date & TimeConsensus EstimateAnalysis
FHFA House Price IndexTuesday, March 30,
10:00 am, et
Up 1.1%Moderately Important. A measure of single-family house prices. Weakness may lead to lower rates.
Consumer ConfidenceTuesday, March 30,
10:00 am, et
86.8Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.
ADP EmploymentWednesday, March 31,
8:30 am, et
525KImportant. An indication of employment. Weakness may bring lower rates.
Weekly Jobless ClaimsThursday, April 1,
8:30 am, et
785KImportant. An indication of employment. Higher claims may result in lower rates.
ISM IndexThursday, April 1,
10:00 am, et
53.1Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates.
EmploymentFriday, April 2,
8:30 am, et
Payrolls +185K
Very important. An increase in unemployment or weakness in payrolls may bring lower rates.

House Price Index

The Federal Housing Finance Agency (FHFA) was created on July 30, 2008, when the President signed into law the Housing and Economic Recovery Act of 2008. The Act gave FHFA the authorities necessary to oversee vital components of our country’s secondary mortgage markets – Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. FHFA’s mission is to provide effective supervision, regulation and housing mission oversight of Fannie Mae, Freddie Mac and the Federal Home Loan Banks to promote their safety and soundness, support housing finance and affordable housing, and support a stable and liquid mortgage market.

“FHFA produces the nation’s only public, freely available house price indexes (HPIs) that measure changes in single-family house prices based on data that cover all 50 states and over 400 American cities and extend back to the mid-1970s. The HPIs are built on tens of millions of home sales and offer insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels. The FHFA HPIs use a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze transaction data from Fannie Mae and Freddie Mac. FHFA releases data and reports on a quarterly and monthly basis. The flagship FHFA HPI uses seasonally adjusted, purchase-only data, unless otherwise noted. Additional indexes are based on other data including refinances, FHA mortgages, and real property records.”

FHFA issues a monthly report on house prices called the House Price Index (HPI) that looks back 2 months in time. This week’s FHFA release will shed light on the current state of housing prices. A solid housing market is vital to the health of the U.S. economy.