Mortgage Rate Update November 14, 2011

Although note rates are unchanged this morning the accompanying closing costs associated with these note rates are higher so in fact rates are slightly worse.

The domestic economic calendar is full this week with reads on inflation (Tues & Wed.), retail sales (Tues.), manufacturing (Tues. & Wed.), and housing starts (Thurs.).  In general good news for the economy is bad news for mortgage rates and vice versa.  However, over the past couple months domestic economic data has been trumped by developments in Europe and that will very likely be the case this week.

Technocrats have assumed power in Greece & Italywith the sole focus on shoring up their country’s fiscal condition.

On Friday stock markets around the globe traded higher (pushing mortgage rates higher this morning) on optimism that these leaders would reform their economies and curb contagion.  That optimism is waning this morning as stocks are idle.

Mortgage rates continue to be directed by changes in sentiment regarding the European debt crisis.  When prospects appear dim mortgage rates move near all-time lows.  When the mood brightens they give a little back.  Thus far rates haven’t been able to crack below these levels so locking is not a bad plan.

Current Outlook: locking bias