Mortgage Rates Predictions
June 17, 2008
June 13, 2008 | Mortgage Rates are headed down…
PPI comes in red hot with Food and Fuel prices pushing inflation. The Core PPI hit expectations and held onto the 3% year over year gains. Inflation with no hope of the Fed bailing out investors should help push bond prices higher as investors move to a flight to quality in Mortgage Backed Securities. Mortgage Bonds have hit a floor of support and bounced Monday and Friday off. This usually signals a reversal.
Mortgage Rates Predictions
June 13, 2008
June 13, 2008 | Mortgage Rates are trying to come down…
CPI reported worse than expectations signaling even more inflation. Consumer Sentiment in June was a horrible 56.7! Mortgage Bonds are were all over the place this morning and currently set +31bp @ 100.03. Hopefully we have seen the floor for Mortgage Backed Securities and we begin the “leash effect” Read more
Mortgage Rates Predictions
June 12, 2008
June 12, 2008 | Mortgage Rates continue to climb on Retail Sales numbers…
After yesterdays Mortgage Bond rally to push rates lower, today’s very strong Retail Sales numbers for May quickly reversed the momentum. Retail Sales in May reported a 1% increase and without Auto Sales the increase was 1.2%. Read more
Mortgage Rates Predictions
June 11, 2008
June 11, 2008 | St. Louis Mortgage Rates are coming DOWN!
We have a good bond rally helping drive mortgage rates lower this morning. Currently, FNMA 5.5% Mortgage Bonds are selling up +84bp for 98.25. As we mentioned earlier in the week Mortgage Bonds seamed oversold. Today the Fed Beige Book Survey Read more
Mortgage Rates Predictions
June 10, 2008
June 10, 2008 | Mortgage Rates are increasing!
The Balance of Trade was slightly higher than analyst expected today. Mortgage Bonds are still getting slaughtered -68bp! The Fed Chairman Ben Bernanke’s speech last night has pushed mortgage bonds to their lowest level since March. Mr. Bernanke is concerned about inflation, but he believes the market will work itself out. The Fed’s lack of action will cause a weaker dollar, higher oil prices, and more inflation. Read more
Mortgage Rates Predictions
June 9, 2008
June 9, 2008 | Mortgage Rates continue to head higher.
This morning Pending Homes Sales actually reported a 6.3% improvement for April. Now that the good news for mortgages is out of the way, inflation seams to be on everyone’s mind. Mortgage Bonds are currently -75bp. $4.00 a gallon was the US average price for gas being broken on Sunday. Today we have a string of FOMC member speaking. The New York Fed President Timothy Geithner has speaks at 12:15pm, Dallas Fed President Richard Fisher is interviewed at 1:00pm, and at 8:15pm ET Fed Chairman Ben Bernanke will be giving his incite on inflation. The end of this week is packed with elevated market movers. As far as mortgage rates predictions for the week, I believe mortgage bonds are oversold and we should get back these losses Thursday’s retail sales report. I predict that rates will improve after today’s unsolicited blood bath.
Mortgage Rates Predictions
June 6, 2008
June 6, 2008 | Rates are still trending higher, even with a 5.5% Unemployment Rate…
This mornings Employment Report had a little suprise hidden inside it. The unemployment rate made an unbelievable +.5% increase in just a month! Non-Farm Payrolls and Hourly Earnings ended up better than economist estimated. The shocking unemployment rate usually would give Mortgage Backed Bonds the boost it needs to approach the 200 day moving average. Already this morning Mortgage Bonds have seen a low of 98.5625 and a high of 99.25. That is almost a 69bp swing! With this volatility floating an interest rate is ludicrous. Even though FNMA Bonds are currently +12bp on the day, it looks like going into the weekend and the fact that any real ELEVATED market moving economic indicators will not be reported until Retail Sales next Thursday, I believe rates are still heading higher. We will keep an eye on the stock market for signs of weakness and keep you updated if Mortgage Bonds gain steam.
Mortgage Rates Predictions June 05
June 5, 2008
June 5, 2008 | Rates are heading up as the battle for the 200 day moving average continues.
Mortgage Bonds were absolutely slaughtered yesterday. The Fannie Mae Bonds opened yesterday at 99.875 and this morning we saw a low of 98.625 already. As a reminder, Fannie Mae Mortgage Backed Securities correlate directly with Long Term Fixed Mortgage Rates. Every -.40-.50 basis points Mortgage Bonds move is +.125% higher interest rate for consumers. That means if yesterday morning 30 Year Fixed was 6.125% and Mortgage Bonds lost -125bp, [99.875-98.625] then this morning that same consumer would have +.25% to +.375% higher rate [6.375-6.500%]. With yesterdays notoriously misleading ADP report showing growth in employment, investors are looking for a stronger than expected employment report tomorrow. Bonds are down -38bp at 98.81 on the day currently with no other important economic indicators scheduled for release. Consumers should lock in their Long Term Fixed rates in this volatile market and definitely consider 5-7 Year Arms as an alterative to 30 Year Fixed since they have been improving.
Mortgage Rates Predictions
June 3, 2008
June 3, 2008 | Rates are still heading higher…
Yesterday the Mortgage Bonds showed a solid recovery during the end of the day to close at 99.59 actually up +25bp from their open of 99.34. This was due to losses in the stock market. The 200 day moving average has still been the Mortgage Bonds personal struggle, currently at 99.51. This morning Mortgage Backed Securities seam to be losing the fight as they are down -19bp on the day at a price of 99.41. Today there are no scheduled economic indicators being released. The fate of Fannie Mae Bonds will be in the hands of stocks, oil, scheduled public speeches, and the 200 day moving average. Let’s hope tomorrow we get some bond friendly news to get mortgage rates lower again.
Daily Mortgage Rates Predictions June 02
June 2, 2008
Rates are still heading higher.
The ISM Non-Manufacturing Survey beats expectations this morning. This was the only scheduled economic indicator released today. Wachovia released it’s CEO Kennedy Thompson today due to continued backlash from Sub-Prime Mortgages. The Nation’s 5th largest bank lost half of its stock value from last year. With the ISM report being positive and looming inflation fears, the 200 day moving average appears to be out of reach for mortgage bonds any time soon. Currently, the Fannie Mae Mortgage Backed Securities are +9bp on the day at 99.28 on the news about Wachovia and struggling airlines. That is actually -12bp lower since the ISM reported at 10:00am. We will be keeping our eyes on the stock market to see signs of pain in the economy that may be helpful for low risk mortgage backed securities.
