Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on March 5, 2010

Locking Stance: LOCKING    Mortgage Bonds: –47bp

Greetings from Santiago, Chile where the earth is still shaking every so often, but certainly not as much as the mortgage bond market.  I told you yesterday that I did not like the way the mortgage backed securities charts’ looked and today you can see why as they have finally begun that overdue correction.  Now we have to wait and see if it is just a correction or what pattern will develop.

Today’s headlines are all about the Jobs Jamboree.  Nonfarm Payrolls came in better than expected at –36K versus –50K.  January and December revisions also added 35K net, making the whole report unfavorable for MBS prices.  The Unemployment Rate was better than expected as well as the Unemployment Rate held at 9.7% versus expectations of 9.8%.  Average Hourly Earnings were below expectations, coming in at 0.1% versus 0.2%.  And Average Workweek was below expectations at 33.1 versus 33.6.  Overall, the Jobs Jamboree numbers were unfavorable for mortgage bonds and MBS prices have plummeted as a result.

What does this mean for Mortgage Rates?  We finally have seen the beginning of a corrective move as I have been expecting.  While the future is not certain, odds still favor mortgage rates climbing from here.

(Note:  So far in Santiago I have not seen a whole lot of damage from the outside of buildings, but just as with the terminal, looks can be deceiving.  Aftershocks continue to be felt here.)

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