Updated on June 19, 2019 10:13:47 AM EDT
We have no relevant economic data set for release today, but we do have a couple of major Fed events taking place this afternoon. The first is the 2:00 PM adjournment of the FOMC meeting that is widely expected to yield no change to key short-term interest rates. Because there is a wide consensus, the lack of a move itself shouldnt have a noticeable impact on the markets. But what is likely to heavily influence trading is any indication of when the Fed may make their next move, which is believed to be a possible rate cut. If there is a hint of that being a reality soon, the bond market should rally, causing mortgage rates to improve.
Also at 2:00 PM ET will be the release of the Fed’s revised estimates for future economic activity. They will post their predictions on GDP growth, unemployment and inflation. These could be a market mover if they show even minor revisions to any of the key headline economic numbers. The larger the change, the more likely the markets will react. Revisions that point toward slower economic growth will be good news for the bond market and mortgage rates.
They will be followed by a press conference hosted by Chairman Powell at 2:30 PM ET. These press conferences with the media can lead to significant afternoon volatility in the markets and mortgage rates. Any surprises will probably cause a noticeable reaction in the markets. That means there is a high probability of seeing afternoon changes to mortgage rates.
We will be updating this report shortly after the markets have had an opportunity to react to the Fed events. There is some minor economic data scheduled for tomorrow morning, which will be addressed in this afternoon’s revision.
©Mortgage Commentary 2019