Mortgage Rate Update November 4, 2011

Mortgage rates are unchanged this morning.  Despite all of political drama in Greece and a hefty economic calendar over the past 48 hours interest rates have been surprisingly quiet.

The all-important monthly jobs report showed that there were 104,000 new jobs created in the private sector last month.  This was just below expectations but not enough to disappoint investors (which would have helped mortgage rates move lower).  The previous two months figures were revised higher which is good news for the economy.

In Europe, a meeting of the G-20 (20 developed nations from around the world) concluded with leaders convincing Greek officials to scrap their plan for a referendum that would allow Greek voters to decide whether or not to default on its debt.  This bodes well for the financial stability of Europe but interest rates have not reacted higher so clearly plenty of skepticism remains.  Much of that skepticism stems from fear over Italy’s fiscal health.  As THIS POST showed Europe’s bailout fund does not have the firepower to bailout Italy AND Greece.

Next week the US Treasury will deliver $70+ billion of new debt supply which normally makes it tough for rates to improve.  In addition, technical trading patterns suggest rates will move higher before they move lower.  But, if Italy’s condition continues to show signs of deterioration over the weekend rates could improve next week.

Current Outlook: Locking bias