Daily Commentary by Larry Baer: According to data released earlier this morning from the Commerce Department November Retail Sales improved a very modest 0.2% on a month-over-month basis - well below most economists' expectations and the slowest growth in this measure of consumer activity since June. The ex. auto component of the report posted a matching 0.2% increase for the month. Consumers are telling surveyors they are further along with their Christmas shopping this year compared to last - which does not bode well for much improvement for retail sales during the month of December. The slower pace of retail sales growth has many economists scaling back their forecast for fourth-quarter economic growth - which in turn supports the prospects for steady to perhaps fractionally lower mortgage interest rates ahead.
The Federal Open Market Committee had gathered for their last monetary policy strategy session of the year. A recent string of improved economic data has eased fears of a near-term recession, buying the Fed time to gauge the likely impact of Europe's debt crisis on the U.S. economy. Most analyst expect the Fed will wait until their two-day meeting on Jan. 24 - 25, 2012 before making any substantive change to existing monetary policy. If this assessment proves accurate, this afternoon's 2:15 p.m. ET release of the FOMC's post-meeting statement will not likely influence the direction of mortgage interest rates one way or the other.
The Treasury Department will be conducting an auction of $21 billion worth of 10-year notes today. The auction is scheduled to conclude at 1:00 p.m. ET and global investor demand is expected to be decent. If so, this event will not significantly impact the mortgage market. I'll let you know how things turn out as soon as possible once the final gavel falls.
THE MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
