Fixed mortgage rates are slightly lower than Friday.
Mortgage Bonds are currently trading up 19 basis points on the morning but have still not broken through a new level of resistance. This level of resistance was considered the floor (or level of support) on the previous weeks before getting broken though late last week.
This morning’s Personal Consumption Expenditure Index (PCE) was reported at 0.0% for January, leaving the year-over-year Core Rate at 1.7%. The Fed’s comfort level for this important inflation indicator is between 1-2%. That is the good news. The bad news is still the concern for Deflation. As Inflation remains the nemesis of Mortgage Rates, Deflation also is a very problematic enemy. Deflation can kill an economy in a downward spiral by causing consumers to hold off buying items and stimulating the economy in hopes of prices moving even lower in the near future.
Current Outlook: Cautiously floating to see if we can break through level of resistance ahead.