Florida Mortgage Daily – Morning Update

by Florida's #1 Mortgage Planner on May 20, 2008

Locking Stance:  FLOATING     Mortgage Bonds:  +19bp

I hope those of you who heard an alert to lock yesterday didn’t rush out and lock your loans.  If you did, hopefully you can get a free float down instead because while bonds did dip close to a re-price, they showed no signs of faltering completely.  By the end of the day they were up 21bp!!

The amazing thing is bonds are moving higher, despite inflation news.  PPI was released this morning, showing tame inflation overall, but increasing inflation at the core level, which should be concerning, except that Fed day is tomorrow and this data all but assures that the Fed will not cut rates (some even think a rate increase is in store, though I doubt it).

Bonds are solidly above all moving averages and are set to test their recent highs.  If they are able to break above these highs, bonds could be looking at a good run, meaning lower rates ahead.

{ 2 comments… read them below or add one }

Tyler Osby May 20, 2008 at 9:24 am

Hey Robert,

I may be mistaken – but I’m pretty sure the next Fed meeting isn’t until June 25th. The news tomorrow is the minutes from the last meeting (4/30). Basically the entire conversation and we’ll probably find out what was said with a 8-2 vote at the last meeting.

Is that right?…. I want to make sure I’m not crazy…

I’ve been a long time reader. Keep up the great work!

Robert D. Ashby May 22, 2008 at 11:41 am

Tyler,

Yes, you are correct. I have been flying a lot this month and misstated “Fed Day” and not the “Fed Unplugged”. It was just the minutes from the last meeting, which, as expected, displayed commentary that the Fed will stop cutting rates. There is still the sentiment that a rate increase may be in store next month.

Thanks for setting the record straight and for the support. I am glad to receive the feedback.

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