For the first time in five weeks, both conforming and FHA Chicago mortgage rates rose.  The all-out global financial crisis was downgraded to a somewhat global financial crisis and we saw stocks gain at the expense of bonds, including mortgage backed securities.

Last week’s interest rates moved higher largely because concerns moved lower.

Mortgage Rate Predictions: Week of June 1, 2010

This week could be even worse.

In addition to the release of May’s jobs report and consumer confidence data, fears of broader economic slowdown appear to be easing.

As the week goes on, we see report after report and all of them are highly influential.

Tuesday:  Consumer Confidence.  This is linked to the economy since 70% of the economy is based on consumer spending.   High confidence = good economy = worse mortgage rates.

Wednesday:  Pending Home Sales and Auto Sales for last month.  Both are “big ticket” items and are therefore tied to consumer confidence.   High sales of big ticket items = high confidence = good economy = worse mortgage rates.

Thursday:  Jobless claims.  This isn’t a big report, but will be watched as a forecasting tool for Friday’s big dog of the week.

Friday:  Non-Farm Payrolls.  April was a net 290k gain.  May, economists are thinking we might see 500k.  As evidenced by the graph, 500k doesn’t even fit.   If job growth even comes close to the 500,000 marker, mortgage rates could zoom higher.  Again, employed consumers are confident consumers and high confidence = good economy = worse mortgage rates.

Mortgage rates moved higher last week but are still very low.   One of these weeks will be “that week” when the whole mortgage rate game changed.  If you’re thinking about refinancing, stop.  Call us.  It’s time.