Florida Mortgage Rates – Evening Report

by Florida's #1 Mortgage Planner on August 28, 2008

Locking Stance:  CAUTIOUSLY FLOATING    Mortgage Bonds:  +12bp

I was called out to fly all day today, so I missed the ability to get timely reports to you, but my stance would not have changed anyway.  Why?  Well, let’s get into what happened today and why floating may even be a good opportunity tomorrow.

Economic data, namely the GDP, was better than expected, which has been a trend lately.  That means the economy is not doing as bad as believed.  However, even oil prices dropping on the dollar’s strengthening, which sent stocks into rally mode, could not take the air out of mortgage bonds’ sails and they sailed through another layer of resistance.

With momentum like that on a day when they should have been beaten down, you just have to feel the fundamentals are changing.  There are still some warning signs in the charts, but they remain to be seen on the trading floor.

Tomorrow holds the key to the MBS rally survival as we will see a huge read on inflation.  As the market opens, the PCE data will be released and if inflation appears to be in check, bonds could retest, maybe even break through, their 200-day moving average.  Are we going to see mortgage rates start coming down finally?  Stay tuned and find out.

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