Rate Update August 17, 2009
Mortgage rates look like they’ll open up on par or better than they were on Friday morning.
Mortgage rates are benefiting from a global “flight-to-quality” as stock markets tumble around the globe (click this link to learn how stocks impact mortgage rates). Investor sentiment around the world has taken a more pessimistic view of the economic recovery.
Where as stocks rallied over the previous few weeks on the idea that the worst was behind us. Investors are now thinking that the economic recovery will be slow and gradual.
Shares in the Chinese Shanghai Composite Index were off 5.8% while Japan and Europe also traded lower. This morning the S & P 500 is off 2.3%.
Looking ahead for the rest of the week we’ll be watching the stock market and an announcement from the US Treasury on Thursday regarding the volume of bond sales for next week. The past few announcements have caused rates to temporarily rise.
Current outlook: float