Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on November 17, 2008

Locking Stance:  LOCKING     Mortgage Bonds:  0bp

Mortgage bonds ended last week in a downward movement, despite the favorable Retail Sales report, marking another failed attempt to break free of their trading range.  That adds more pressure on mortgage bonds as this week gets started.

The headlines this morning include Citigroup’s announcement to slash 50,000 workers, but remember that this past week’s Initial Jobless Claims were the worst since 2001 and the prior week finished with an abysmal jobs report, yet mortgage backed securities could not drive mortgage rates lower.  Therefore, don’t expect much reaction in the mortgage bond pit from this news.

We do have a couple of data releases today.  The Empire State Index was just released (a little better than expected) and we are expecting the G.17 report a little while later, which covers Industrial Production and Capacity Utilization.  Neither report typically drives mortgage rates much, so technical indications are likely to rule the day, much like they have been.

Looking at the charts, we do not see a very good picture for the future of mortgage rates.  Mortgage backed securities, while trading back and forth along their 200-day moving average, are currently below this major support.  Additionally, the pattern we are seeing resembles that of the beginning of the trading range back in September, which I talk about more in my weekly Mortgage Market Update over at Lenderama.  All in all, the odds favor mortgage rates creeping higher.

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