Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on January 28, 2010

(this report is also available at MBS Commentary)

Locking Stance: LOCKING    Mortgage Bonds: -3bp

Mortgage backed securities are down today, but off their lows at the support of the 200-day MA.  While that is a good sign, the charts still indicate the likelihood they will move lower still.  Data has begun to "heat up" today and tomorrow will have a big player or two, leaving the possibility of a significant drop in MBS prices in plain view.

Today’s data thus far has been the weekly Jobless Claims and Durable Goods Orders.  Durable Goods Orders were well below expectations, coming in at 0.3% versus expectations of 1.6%.  The year/year rate is still higher than the last report, up to -3.1%.  The results are better when you exclude transportation as we saw an increase of 0.9% and the year/year rate is now positive at 0.5%, still nothing to get excited about, but will hurt mortgage bonds a bit.  Jobless Claims, however, are favorbale in the fact they were again higher than expected, coming in at 470K versus 440K.  The 4-week moving average is also back on the rise now, climbing to 456.25K.  With Jobless Claims climbing again, one would expect MBS prices to be rising more than they are, but perhaps traders are just awaiting tomorrow’s data.  Or is it this afternoon’s 7-year T-note auction?

What does this mean for Mortgage Rates?  Mortgage rates are holding fairly steady right now, but the outlook, while still somewhat uncertain, favors higher mortgage rates.

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