Rate Update for August 29, 2008
Mortgage rates are slightly lower today but we don’t expect that to last.
This morning the Personal Consumption Expenditure (PCE) report was released and showed worse than expected inflation pressures (bad sign for mortgage rates). The report indicated that prices in the PCE index rose by 4.5% from a year earlier which is the highest climb since February 1991.
When you strip out volatile food and energy prices the so called “core” index rose by 2.4%. This is the steepest year over year increase since February 2007.
Hot inflation news is a negative sign for mortgage rates. This coupled with touch technical trading patterns lead us to believe that rates will be moving higher in the near-term. Its time to lock!