Mortgage rates experienced a slight dip today, ending the week with a modest decline. The market opened with a positive note, but sentiment shifted throughout the day as investors digested mixed economic data.

Market Movement:

• Morning: Mortgage-backed securities (MBS) initially saw a significant increase, reflecting positive market sentiment.
• Midday: The momentum reversed, with MBS prices gradually declining.
• Afternoon: The downward trend continued, with rates edging higher towards the end of the trading session.
• Day’s End: MBS prices closed lower, approximately 22 basis points below morning levels.

Economic Factors:

• ISM Manufacturing: The Institute for Supply Management (ISM) released its Manufacturing PMI, which showed a surprising increase, exceeding market expectations. This unexpected strength in the manufacturing sector could potentially tighten monetary policy in the future.  
• Dow Jones Industrial Average: The Dow closed higher, indicating positive investor sentiment in the broader stock market.  

Looking Ahead:

Next week will be crucial for the mortgage market, with several key economic data releases:

• Monday: ISM Services PMI
• Wednesday: Federal Reserve meeting minutes (December 18th)
• Friday: Job Report (employment data, unemployment rate, wage growth)

These reports will provide valuable insights into the current state of the economy and the Federal Reserve’s future monetary policy decisions.

Rate Update:

• For a 30-year conventional fixed-rate mortgage on a $400,000 purchase with 20% down, the par rate is currently 6.990% with an APR of 7.217%. This translates to a principal and interest (P&I) payment of $2,127.
• The lowest available rate is 4.750% with an APR of 5.901%. However, this requires purchasing $31,925 in discount points to buy down the rate, resulting in a P&I payment of $1,669.

Disclaimer: This information is for general knowledge and informational purposes only and does not constitute financial, investment, or legal advice.