|US dollar index||88.3||0.2|
|10 Year Govt Bond Yield||1.78%|
|Current Coupon Fannie Mae TBA||103.3|
|Current Coupon Ginnie Mae TBA||104.2|
|30 Year Fixed Rate Mortgage||3.58|
Stocks are higher this morning on good overseas economic data. Bonds and MBS are down.
Inflation at the producer level is picking up, according to the Producer Price Index, which rose 0.3%, higher than expected. The core index is up 1.5% YOY. Inflation remains under the Fed’s target, but we are seeing it creep up towards their preferred 2% range.
Retail sales increased 0.6% last month, in line with expectations. Retail Sales ex autos and gasoline rose 0.3%. Housing-related sales did particularly well, with furniture up 1% and building materials up 1.4%. I wouldn’t be surprised to see some strategists take up their Q3 GDP estimates on this number.
Consumer sentiment unexpectedly fell in early October, according to Reuters and the University of Michigan.
Business inventories rose 0.2%, a little higher than expected. This will have the effect of goosing Q3 GDP growth at the expense of Q4.
Wells Fargo reported earnings this morning. Origination was up 11% QOQ to $70 billion. Purchase activity accounted for 58% of originations. The stock is unchanged in early trading.
JP Morgan reported earnings this morning as well. Mortgage origination was up 8.4% QOQ to $27.1 billion. On an annualized basis, it is down 9.4%.
The typical homeowner’s perception of the value of their home is about 1.25% lower than where the appraised value has been coming in. Appraised values are up almost 8% YOY, which is a faster rate of appreciation than we have been seeing in the real estate indices like FHFA or Case-Shiller.