Mortgage Rate Update May 9, 2011

Mortgage rates are mostly unchanged this morning.

Despite the relatively upbeat jobs report on Friday which would normally push yields higher, interest rates remain at 4-month lows.

It's still not clear if Greece will make it through

Earlier this morning Standard & Poor’s downgraded the credit rating of Greece to B- which is bringing the European debt situation back into the spotlight.  This news is driving investment capital into relatively “safe” US-denominated debt helping to keep rates low.

Looking ahead for the week the US Treasury is scheduled to auction $72 billion in 3-year, 10-year, and 30-year treasuries so we’ll have to watch how the additional supply will impact the market.

Technically mortgage rates remain vulnerable so I will maintain a locking bias.

Current Outlook: locking bias