Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on February 20, 2009

Locking Stance: LOCKING    Mortgage Bonds: +31bp

Mortgage bonds are trapped in one heck of a squeeze play at this point.  Yesterday saw a fairly steep selloff in MBS, with them rallying back to end the day only down 25 basis points, which they have regained today and then some.  Right now, it looks as if the rally will fail as it fails to penetrate resistance again, but things could change and I will post if they do.

The Philadelphia Fed Index released yesterday was much worse than expected and Money Supply added $11.2B.  Today’s data play rests solely on this morning’s CPI numbers.  The overall CPI number came in as expected at 0.3%, bringing the yearly rate to -0.2% according to the way it is currently calculated.  The Core CPI presents a little different picture, beating expectations slightly with a reading of 0.2% versus the expected 0.1% and that has the yearly rate climbing again, up to 1.7% versus expectations of 1.5%.  So, deflation is avoided at the core level and, in fact, inflation is again a growing concern.

What does this mean for Florida Mortgage Rates?  Expect mortgage rates to hold steady if not climb today and the future remains favoring rates moving higher.

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