Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on April 15, 2010

Locking Stance: LOCKING    Mortgage Bonds: –6bp

You just have to love the current market now that the Fed is no longer manipulating it, right?  Well, the Fed is still somewhat trying to manipulate the markets with all of their speeches this week, and today is no exception.

Yesterday, we saw Ben Bernanke, Sandra Pianalto, Kevin Warsh, Jeffrey Lacker, Richard Fisher, and Brian Sack speak.  Some are not overly important, or even followed, but Big Ben went on record to say there are encouraging signs in the labor market.  Obviously he did not know about this morning’s Jobless Claims report, though he did express concern about the fact 44% of the unemployed have now been out of a job for at least six months.  He also continued to say inflation was in check and should remain stable.  Hmmm…maybe because no one can afford anything since they don’t have a job?  What happens when the job market does actually come back, which likely won’t be until after Obama lets companies know that the Bush tax cuts won’t expire, something that is not likely to happen.  All of the uncertainty surrounding taxes and out of control government spending is what is one of the main things holding businesses back from hiring. 

As mentioned, Jobless Claims was released this morning and was certainly favorable for MBS prices, and thus mortgage rates.  Jobless Claims came in at 484,000, up from 460,000 last week and well above expectations of 440,000.  The 4-week moving average rose to 457.75K and continuing claims is back on the rise as well.  Part of the reason MBS prices are not able to rally is that the Empire State Manufacturing Survey was reported at 31.86, exceeding the consensus of 25.0 and well above 22.86 in the prior report.  The Treasury International Capital report showed Foreign Demand for Long-Term US Securities was net $47.1B.  The demand, however, was from private foreign investors as foreign official institutions were net sellers.  Industrial Production was also reported, showing Production was well below expectations, coming in at 0.1% versus 0.8%, and the Capacity Utilization Rate rose to 73.2%, which was just shy of the 73.4% expected.  The Philadelphia Fed Survey is slated to be released at the top of the hour, but if it is anything like the Empire State report, MBS prices will be headed lower still, matching what the charts predict, which is a sideways pattern at best.

What does this mean for Mortgage Rates?  Mortgage rates continue to edge slightly higher, though the short-term and even long-term picture is somewhat in question right now.  If mortgage rates can hold here, or turn lower, the outlook could still change, though at the moment odds favor higher mortgage rates.

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