Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on December 16, 2009

Locking Stance: CAUTIOUSLY FLOATING    Mortgage Bonds: +6bp

Mortgage backed securities had a brief scare yesterday as they dropped below their 200-day and 100-day MAs.  They did, however, manage to crawl back to close even with their 100-day MA and above their 200-day MA and that likely means the retracement has begun, especially if they move higher today as they currently are.  Keep in mind this move will likely be a brief one, hopefully up to their 10-day MA before falling again.

This morning’s data thus far has included the Consumer Price Index, or CPI, which is a huge play for the inflation-haters.  The CPI overall came in inline with estimates at 0.4% with the year over year climbing to 1.9%.  The Core CPI was just below estimates at 0.0% versus 0.1% keeping its year over year at 1.7%.  The next big inflation play will be the Personal Consumption Expenditures, or PCE, as it is the Fed’s favorite gauge on inflation and is due out next Wednesday, Dec. 23.  The next big play today will be the release of the Fed’s Policy Statement at 2:15.  Remember, do not worry much about their decision on the Fed Funds Rate, unless the actually raise it which is highly unlikely.  Rather, focus on their Policy Statement.

Let’s get into the remainder of the data today.  MBA Purchase Applications showed a slight decline in Purchase Applications (-0.1%) while Refinance Applications rose 0.9% with the 30-year loan rates at 4.92%.  Housing Starts showed Housing Starts just below the consensus, coming in at 574K while Building Permits edged higher to 584K.  The Current Account now sits at $-108.0 B, down $10 B from last quarter and is 3.0% of GDP, the highest since the 4th quarter of last year.  More importantly is the fact that private foreign accounts were net sellers of Treasuries, though not as bad as last quarter.  Crude Inventories will be released at 10:30, but the big play will be the Fed at 2:15.

What does this mean for Florida Mortgage Rates?  Unless there is a surprise by the Fed, mortgage rates should hold steady or dip a little.  The long-term outlook is for higher mortgage rates at the moment, though their should be a short-term floating opportunity.

Leave a Comment

Previous post:

Next post: