Mortgage Rate Update February 17, 2011

Posted on by Evan in Rate Update

Mortgage rates are unchanged this morning.

Are we seeing beginning of inflation?

Wednesday & Thursday’s hotter than expected inflation data has finally sunk in on Wall Street this morning.  I had blogged yesterday that geopolitical unrest in the Middle East was drawing attention away from the PPI & CPI reports.  Today, the political uncertainty has subsided (for now) and investors are remembering that inflation is bad for long-term interest rates.
Mortgage rates will have to compete with the US Government next week as the US Treasury is scheduled to deliver $99 billion in 2-year, 5-year, and 7-year notes to the market.  Click HERE to understand how this may impact mortgage rates.

From a technical perspective mortgage rates have had a decent run lower in the past few days.  Strictly looking at the technical trading patterns it appears there may be room a little more improvement but the fear of inflation may get in our way.

The bond market is closed on Monday for President’s Day so ‘Rate Update’ will also take the day off.

Current outlook: neutral