Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on February 17, 2010

Locking Stance: LOCKING    Mortgage Bonds: –9bp

Mortgage backed securities managed to push higher and even close above their 100-day moving average yesterday, a good sign for lower mortgage rates ahead…usually.  The move was sparked by Fed talks of tame inflation even while oil spiked and the dollar fell.  The short-term Treasury Auctions went well yesterday also aiding mortgage bonds’ move.  But I remain unconvinced this move will hold yet as it still has not passed a solid retracement pattern, but that may come to an end today if MBS prices can regain their lost ground.  We will see.

Data was flowing this morning, starting with the weekly MBA Purchase Applications report.  The report showed another decline in Purchase Applications, coming in at –4.0% as Refinance Applications also were negative at –1.2%.  Housing Starts came in at 591K, up from 557K while Building Permits dropped from 653K to 621K, keeping the housing recovery clear as mud.  Industrial Production showed Production at 0.9%, slightly better than estimates of 0.8% with Capacity Utilization inline with expectations at 72.6%.  Overall, Industrial Production posted another strong gain only this time the move was real and not just weather related.  We are still awaiting this afternoon’s release of the FOMC Minutes, or “Fed Unplugged”, and Philadelphia Federal Reserve Bank President Charles Plosser speech on lessons of the financial crisis to the World Affairs Council of Philadelphia.  Things could get interesting.

What does this mean for Mortgage Rates?  Mortgage rates may make a move today, especially this afternoon, so there may be a change of stance this afternoon if mortgage rates find their way lower.  The long-term outlook may be changing and is unclear at the moment.

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