Rate Update February 8, 2010

Mortgage rates are unchanged from Friday.

It will be a light week in terms of economic reporting.  We’ll be tracking three main influences on mortgage rates:

  1. 1) US Treasury Auctions: The treasury is scheduled to auction $81 billion in notes and bonds this week.  Although treasury auctions have yet to have a material impact on mortgage rates we maintain the threat exists.  Click HERE to understand how government borrowing can influence mortgage rates.
  2. 2) Greece & Portugal’s fiscal health: Over the past two weeks the problems surrounding Greece and Portugal have driven investors into “safe” US fixed-income investments.  This “flight-to-quality” has helped push yields lower.  Should the situation improve we’d expect rates to reverse higher and vice versa.
  3. 3) Stock market: Whenever economic data is light mortgage-backed bonds (MBS’s) tend to react to the stock market and technical trading patterns.  Stocks have started the week lower which should help keep rates low.

Current outlook: float