Indexes Affecting Rate Lock

High

Positive

ISM Index (Institute for Supply Management)

This morning’s economic release came from the Institute for Supply Management (ISM), who announced their August manufacturing index stood at 54.6. This was a decline from July’s 55.6 and lower than expectations. The lower reading means fewer surveyed manufacturers felt business improved during the month than did in July. As a sign of slowing manufacturing activity, we can label the report good news for bonds and mortgage rates. We saw bonds improve after the report was posted, erasing most of the overnight losses that could have led to a more noticeable increase in this morning’s rates.

Medium

Unknown

ADP Employment

Tomorrow brings us two morning economic reports and an afternoon Fed report. The day will start with the release of August's ADP Employment report before the markets open. It tracks changes in private-sector jobs, using the company's payroll processing clients as a base, but is not reliable in predicting the more influential governmental version that will be posted Friday. Analysts are expecting to see 45,000 new private-sector jobs were added to the economy last month. A number that is higher than expected would be negative news for mortgage rates while a much smaller increase would be favorable.

Medium

Unknown

Factory Orders

July's Factory Orders data will be posted at 10:00 AM ET tomorrow. This is another manufacturing sector report and is similar to last week's Durable Goods Orders report, but doesn’t carry nearly as much importance as some of this week’s other reports. Forecasts show a 0.5% rise in orders at U.S. factories for both durable and non-durable goods, hinting at gains in the manufacturing sector. A decline would be favorable for bonds. However, this data likely won't cause much movement in rates unless its results vary greatly from forecasts since the big-ticket products portion of the report was released already.

Medium

Unknown

Fed Beige Book

The Federal Reserve will release their Beige Book report at 2:00 PM ET tomorrow, making this the afternoon event for rates. This report details current economic conditions in the U.S. by Federal Reserve region through the eyes of their business contacts. It is believed to be a key source of data when the Fed meets for their FOMC meetings and is usually released approximately two weeks prior to each meeting. If it reveals any significant surprises or changes from the previous release, we may see movement in the markets and mortgage pricing as analysts adjust their theories about what the Fed will do regarding a potential rate hike at their September 15-16 FOMC meeting. Good news for mortgage rates would be weaker activity with signs of easing inflation that lowers the possibility of the Fed raising key short-term interest rates in the immediate future.

Rate Lock Advisory

Mortgage Rate Trend

Indexes Affecting Rate Lock

ISM Index (Institute for Supply Management)

ADP Employment

Factory Orders

Fed Beige Book

Float / Lock Recommendation