Florida Mortgage Rates – Morning Report

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

Locking Stance: LOCKING    Mortgage Bonds: –56bp

Mortgage backed securities had a bad day yesterday, ending the day down 103 basis points.  This morning, MBS pricing gapped down below their 200-day moving average, which leaves them in a tough position to keep from faltering further, though they are attempting that feat.  I hope you all have been heading my advice, especially over the last 3 days.

Today was the release of the Jobs Jamboree, the four reports that make up the jobs data that is released the first Friday of the month.  Much as I figured, the jobs report was a shock to the system.  Nonfarm payrolls blew away expectations by coming in at –345K versus –530K, and the prior month’s data was revised better as well.  However, the Unemployment Rate was worse than expected, coming in at 9.4% versus 9.2%.  Average Hourly Earnings were slightly below expectations, as was the Average Work Week.  Overall, a mixed bag of data, though the payrolls is what shocked the markets this morning.  Traders are shrugging it off a bit now as the realization that more jobs will be lost via GM, and others, and next month’s report may be considerably worse.

As for the remainder of the day, Donald Kohn will be speaking at 2:15 and Consumer Credit will be released at 3:00.  After traders make their profit plays, which will likely keep MBS price volatility high, expect mortgage backed securities to remain below their 200-day moving average and that may be the setup for continued climbs in mortgage rates.

What does this mean for Florida Mortgage Rates?  Today will be crucial for the future of mortgage rates, though the picture remains most favorable for higher mortgage rates.

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