Market Commentary

Updated on June 24, 2022 10:11:45 AM EDT

The Commerce Department released May's New Home Sales report at 10:00 AM ET this morning. It showed that sales of newly constructed homes jumped 10.7%, exceeding forecasts. The stronger number is a sign of strength in the housing sector, making the report bad news for rates. However, this report covers just a small portion of all home sales in the U.S., limiting its impact on today's rates.

Also posted late this morning was the University of Michigan's revised Index of Consumer Sentiment for June. They announced a 50.0 reading that was a slight downward change from the preliminary 50.2 that was posted two weeks ago. The downward revision isn't enough of a change to mean that much, but the fact we saw a nice decline from May's 58.4 is a sign that consumers a less confident about their own financial situations and are likely to spend less. Since consumer spending makes up two-thirds of the U.S. economy and bonds tend to thrive in weaker economic conditions, we can consider this report good news for mortgage rates.

Next week has a full calendar of economic releases and Treasury auctions that may affect mortgage rates, including a couple reports that carry elevated importance. The week starts off with one of those releases when May's Durable Goods Orders report is posted, followed by results of the 5-year Treasury Note auction during afternoon hours. It closes with a very important manufacturing report Friday morning. Look for details on all of next week's activities in Sunday evening's weekly preview.

 ©Mortgage Commentary 2022