Durable Goods Orders
Also early this morning was the release of December’s Durable Goods Orders report. The Commerce Department said that new orders for big-ticket items such as airplanes, appliances and electronics rose a surprising 5.6% last month, blowing past estimates of 2.9%. While the big jump can be considered bad news for rates, as with the GDP reading, there is some good news behind that headline number. First, this data is known to be quite volatile from month to month, so the variance isn’t as meaningful as it would be if it came in most other releases. Second, a reading within the report that excludes more costly and volatile airplane and other transportation orders came in much closer to forecasts than the main reading did. Still, we have to label the report as unfavorable for mortgage rates.