Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on March 5, 2009

Locking Stance: CAUTIOUSLY FLOATING    Mortgage Bonds: +22bp

You read it correctly, I have changed my stance and here is why.  The correction that has been taking place has now possibly become a trend reversal, though it is still too early to tell with certainty.  The question is was it the Fed or simply the stock market collapse that is the culprit.

Whatever the case, it won’t matter for another trading day or two, as one day above resistance does not guarantee they will stay there.  At this point, mortgage backed securities have broken through their 25-day moving average and look to hold above it today.  Their rally yesterday failed to break through again, but if you look at the charts, the support held as well, so the next couple of trading days will be key as to where mortgage rates may be heading.

Data plays today included this morning’s Jobless Claims, which actually came in lower than expectations, though only slightly, 639K versus 650K.  Productivity was well below expectations though, coming in with  -0.4% versus expectations of 1.0%.  With productivity dropping, it is negative for the economy, but with the decrease in supply about to come, that inflation picture I have talked about becomes more of a potential reality, the question is when.

What does this mean for Florida Mortgage Rates?  Today should see slightly better mortgage rates, though the future is not solid yet, hence the caution. 

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