Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on November 6, 2009

Locking Stance: LOCKING    Mortgage Bonds: +19bp

Mortgage backed securities are falling off their highs already, but the main story, and reason for their climb through their 25-day MA, is the Jobs Jamboree.  I am not switching stances, but with the strength shown yesterday and followed through this morning, a new pattern may now be forming, but I will get into that later.

Nonfarm Payrolls came in at –190K, above the consensus of –175K, and that is one of the reasons MBS prices rose after the report.  The other is the headline of double-digit unemployment as the Unemployment Rate hit 10.2%.  The Average Work Week dropped slightly to 33.0 hrs, and the Average Hourly Earnings rose 0.3%, above expectations of 0.1%.  The latter reports could weigh on inflationary fears, though the traders are jumping all over the Unemployment Rate right now.  Remaining data today, such as Consumer Credit, will not likely impact the markets.

Looking at the charts, the negatives are now turning somewhat positive again, but prior strength appears to be weakening.  With MBS prices pushing through their 25-day MA and stochastic indications positive again, things are looking better.  While this is a positive, since MBS prices have fallen dramatically since the “knee-jerk” of the Jobs Jamboree, they may not be able to maintain their ground above that 25-day MA.  If they can hold their ground, I may switch stances later, but if they continue to show weakness today and fall back below their 25-day MA, locking will remain the most prudent option.

What does this mean for Florida Mortgage Rates?  Mortgage rates are edging lower this morning, though may tick higher by this afternoon as some lenders may re-price as mortgage bond prices fall back.  The outlook is again uncertain.

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