Mortgage Rate Update April 21, 2014

Mortgage rates are essentially unchanged from Thursday of last week.

The financial markets are fairly quiet this morning so interest rates are responding to technical trading patterns.  The technical outlook in the interest rates market is positive so we will float today.

Looking ahead for the week the economic calendar is light this week but we could see some volatility in the stock market.  Four of the 30 Dow Jones Industrials components are set to release 1st quarter earnings reports this week.  These companies tend to influence the broader market so should theses reports be strong it could pressure mortgage rates higher and vice versa.

Other story-lines to follow this week?  Geopolitical uncertainty persists in Ukraine which is helping to keep US interest rates down.  The US is set to deliver $96 billion in new debt supply this week.  The additional supply could make it more difficult for rates to improve.

One topic we’ll need to keep a close eye on is inflation.  Since the Great Recession inflationary pressure in the US economy has basically been non-existent which is partially why mortgage rates have remained at historically low levels.  However, recent readings on price pressure at the wholesale and retail levels of our economy have shown that it may be picking up.  If this trend continues I expect mortgage rates to follow suit.

Current Outlook: floating