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Market
Comment
Mortgage bond prices finished the week near unchanged which held rates steady. Trading remained within a very narrow range despite significant stock volatility. Some of the delayed data from September and October were finally released, but most of the backlogged data will arrive next month. October jobless claims were 223K vs 232K. ADP weekly employment fell 2.5K vs down 7K. NAHB housing was 38 vs 37. Factory orders rose 1.4% as expected. The trade deficit was $59.6B vs $61B. Philadelphia Fed business conditions index was 49.6 vs 38. Existing home sales were 4.1M vs 4.08M. September unemployment was 4.4% vs 4.3%. Payrolls rose 119K vs 50K. Average Hourly Earnings rose 0.2% vs 0.3%. Mortgage interest rates finished the week with no discount point changes.
LOOKING
AHEAD
|
Economic
Indicator |
Release
Date &
Time |
Consensus
Estimate |
Analysis
|
|
Producer Price Index
|
Tuesday, Nov. 25,
8:30 am, et
|
Up 0.3%,
Core up 0.2%
|
Important. An indication of inflationary pressures at the producer level. Weaker figures may lead to lower rates.
|
| Retail Sales |
Tuesday, Nov. 25,
8:30 am, et
|
Up 0.4%
|
Important. A measure of consumer demand. A smaller than expected increase may lead to lower mortgage rates.
|
| FHFA House Price Index |
Tuesday, Nov. 25,
10:00 am, et
|
Up 0.4%
|
Moderately Important. A measure of housing. Weakness may lead to lower mortgage rates.
|
| Consumer Confidence |
Tuesday, Nov. 25,
10:00 am, et
|
93.3
|
Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.
|
| Durable Goods Orders |
Wednesday, Nov. 26,
8:30 am, et
|
Up 2.2%
|
Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates.
|
| Weekly Jobless Claims |
Wednesday, Nov. 26,
8:30 am, et
|
224K
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Important. An indication of employment. Higher claims may result in lower rates.
|
| Fed “Beige Book” |
Wednesday, Nov. 26,
2:00 pm, et
|
None
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Important. This Fed report details current economic conditions across the US. Signs of weakness may lead to lower rates.
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Fed Stability Report
The November 2025 Financial Stability Report by the Federal Reserve assessed vulnerabilities in the U.S. financial system. The release noted asset valuations remain elevated, with equity price-to-earnings ratios near historical highs, equity premiums below medians, and corporate bond spreads tight at 0.7 to 1.6 percentage points under historical medians. Treasury and equity market liquidity has recovered from April 2025 declines, while commercial real estate prices show stabilization amid refinancing pressures.
Near-term risks include rising term premiums and long-term interest rates tied to persistent inflation, potentially increasing delinquencies, debt-servicing costs, and fair value losses; a global growth slowdown, which could trigger asset selloffs, higher defaults, and credit restrictions; and cyberattacks disrupting markets via interdependencies, with examples including impaired clearing or third-party provider failures. A survey of 23 market contacts identifies policy uncertainty, geopolitical tensions, higher long-term rates, persistent inflation, and an AI sentiment reversal as top concerns, potentially amplifying spillovers from private credit opacity or nonbank stresses. Federal Reserve actions, such as capital requirements and stress testing, aim to mitigate these through enhanced resilience.
The Fed’s next move December 10th is uncertain. Sentiment shifted recently from an assured cut to a 75% chance. Be cautious in this environment with float/lock decisions amid continued volatility.
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