Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on May 29, 2009

Locking Stance: CAUTIOUSLY FLOATING  Mortgage bonds: +19bp

Yesterday was a wild ride for mortgage backed securities, with MBS pricing trading in a 113 basis point spread, including testing their 200-day moving average, which is what I wanted to see.  They finally ended the day up 34 basis points.

After yesterday’s higher closing and this morning’s move higher as I write this report, it appears the retracement is underway, allowing at least a brief opportunity to float and recover some of the lost ground.  We do have a positive stochastic crossover, and with stochastics well into the oversold spectrum, this is another good sign of the opportunity to float.  That opportunity may be short lived, so check back regularly as I will post any major changes. 

And for data today, there is no shortage, and that means things could change very quickly.  The GDP data was already released and is being “digested” by traders.  Real GDP came in close to expectations at –5.7% versus –5.5%.  The GDP Price Index, a measure of inflation, came in a hair below expectations with a showing of 2.8% versus 2.9%.  Still to come is the biggest player of the day, the Chicago PMI, along with Consumer Sentiment shortly thereafter.

What does this mean for Florida Mortgage Rates?  Currently, the retracement is underway and this allows a brief opportunity to float.  Be alert, though, as things change quickly and the overall outlook is for higher mortgage rates.

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