Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on May 13, 2009

Locking Stance: LOCKING    Mortgage Bonds: +28bp

Mortgage backed securities have managed to get back into their trading range fairly solidly and even have broken above their 25-day moving average.  However, they are now bumping against another layer of resistance and that is holding at the moment.  In this environment, volatility can be expected, covering days instead of the typical intraday movements.  While the chart patterns are improving, there is still caution to be had, and I don’t base my locking stance on just one day, or even intraday as you probably have guessed by now, rather longer term outlooks.  I am thinking about providing varying outlooks in the future.

Now, as for today, the main event was already released, which was Retail Sales.  One of the main reasons for the upside move today was that Retail Sales missed their expectations by a long shot, coming in at  –0.4% versus 0.1% and when autos are removed they got worse, with –0.5% versus 0.3% expected.  One thing to keep in mind is that retailers have recently been saying that sales are beating their expectations so the next Retail Sales data may be better.  For now, this is the first real sign that the economy is not doing as good as expected and that is good for mortgage bonds. 

Inflation is another story and that will be making headlines on Friday.  Will it be in check?  Maybe, but if you have been pumping gas or even shopping recently, chances are you have seen prices going up, so while it may be “tame” now, next month could be another story altogether as well.

What does this mean for Florida Mortgage Rates?  Chances are mortgage rates have improved as much as they will today and they outlook has improved, but mortgage rates are likely to climb higher from here.

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