The mortgage market is drifting aimlessly this morning as investors await the details of this afternoon's $21 billion 10-year note sale. The Treasury Department will conclude the sale promptly at 1:00 p.m. ET. If this offering is aggressively bid by the global investment community - look for mortgage interest rates to remain very near current levels.
IF the government finds it necessary to push the yield to investors up by accepting lower priced bids for this batch of 10-year notes -- mortgage interest rates will almost certainly edge higher.
The Mortgage Bankers of America reported earlier today that its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loan requests, climbed 0.5% higher during the week ended March 5th. The component of the index that measures loan requests for home purchase increased 5.7%, while the demand for refi's dropped 1.5%. The MBA said borrowing costs for 30-year fixed rate mortgages, excluding fees, average 5.01% up 0.06% from the previous week.
The economic calendar won't offer anything substantial for mortgage investors to chew-on until Friday's 8:30 a.m. release of the February Retail Sales figures. The consensus estimate is currently forecasting the pace of retail sales was 0.2% lower last month while sales excluding autos are expected to post a very modest gain of 0.1%.
If the consensus estimate is accurate, the February retail sales data will likely prove to be supportive of steady mortgage interest rates. Should the actual February retail sales headline figure post a gain of 0.1% or more and the ex. auto component shows a gain 0.3% or more -- look for mortgage investors to push interest rates fractionally higher.
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