Market Commentary

Updated on March 25, 2025 10:16:15 AM EDT

March's Consumer Confidence Index (CCI) was posted at 10:00 AM ET this morning, revealing surveyed consumers were less optimistic about their own financial situations than many had thought. The CCI was announced at 92.9, down from February's 98.3 and short of the 95.0 that was expected. This was the lowest reading since January 2021 and indicates consumers are growing more concerned about their finances. Waning confidence is good news for the bond market and mortgage rates because it usually translates into weaker consumer spending numbers that make up two-thirds of the U.S. economy.

Also released late this morning was February's New Home Sales report. It showed sales of newly constructed homes rose 1.8% last month, hinting at strength in the new home portion of the housing sector. This was close to expectations and has had little impact on this morning's trading.

Tomorrow has a single morning economic release and an afternoon event that we will be watching. February's Durable Goods Orders will be posted at 8:30 AM ET. It will give us insight into the manufacturing sector by tracking new orders at U.S. factories for big-ticket items. These are products such as electronics, refrigerators and airplanes that are expected to last at least three years. Analysts are expecting to see a 1.0% rise in new orders. It is worth noting that this data is known to be quite volatile from month to month, so large swings in the headline reading are common and won't be as meaningful as it would be in most other reports. Good news for mortgage rates would be a noticeably larger decline.

5-year Treasury Notes will be sold tomorrow in the first of this week's two relevant auctions. These sales affect trading in the broader market more than a direct impact on rates. If it goes poorly, meaning demand from investors was soft, we could see selling in the broader bond market that leads to an upward afternoon revision in mortgage rates tomorrow afternoon. However, strong sales usually make bonds more attractive to investors that translates into an improvement in pricing. Results will be posted at 1:00 PM ET, so look for any reaction to come during early afternoon hours tomorrow.

 ©Mortgage Commentary 2025