Mortgage Rate Update March 8, 2011

Mortgage rates are unchanged again this morning.

Fighting continues in Libya but many analysts believe Moammar Gadhafi’s reign is close to ending.  Representatives from OPEC nations are meeting today and are expected to decide whether or not to boost oil production in response to disruptions in Libya.  For now oil remains well over $100/ barrel.

30 year fixed mortgage rates have been held below 5.00% (APR: 5.12%) since Valentines Day thanks to a flight-to-safety trade which I expect to unwind once Gadhafi is thrown from power.

Meanwhile, inflationary pressure around the globe continues to grab headlines.  Standard & Poor’s reported earlier today that growing price pressures pose a risk to the stability of India, Indonesia and other countries.

In Europe, Central Bank officials are announcing that the EU will likely have to begin raising short-term rates sooner than expected to curb inflationary pressure.  Indirectly, this would likely cause long-term rates in the US to rise.

I will shift my outlook to a locking bias.

Current outlook: locking