Rate Update for July 18, 2008
Mortgages rates are slightly higher for a 3rd straight day.
Since July 15th the stock market has rallied by over 4%. This rally has pressured mortgage-backed bond prices lower by 188 basis points. Below is a chart showing mortgage backed bond prices over the past 6 months.
Mortgage-backed bonds are currently trading at recent support levels which mean we may see some stabilization to prices and possibly even a reversal. We are shifting our outlook to a cautiously floating stance in the hopes that this layer of technical support will help rates move back down.