Based on the rates sheets we have thus far mortgage rates remain unchanged from Friday, BUT we expect rates to improve by mid-morning.
Mortgage-backed bonds rallied yesterday and are following through again this morning on better than expected worker productivity numbers. The more productive workers are the less wages corporations have to pay to produce a unit of output which is good news on the inflation front.
Looking ahead the two major story lines of the week will kick-off today. First, the US treasury will begin 3 days of heavy treasury bill auctions this morning. So long as foreign appetite remains strong for US debt mortgage rates should remain low.
Second, the Federal Reserve Open Market Committee begins day 1 of their 2 day meeting today. Although we don’t expect any change to short-term interest rates their post meeting comments can always shake up the markets.
Current outlook: float at least until mid-morning