Rate Update January 21, 2010
Mortgage rates are mostly unchanged from yesterday.
The Conference Board’s Index of Leading Economic Indicators, which is designed to predict future economic activity, was reported this morning and showed better than expected growth on the horizon. Ordinarily good news for the economy is bad news for mortgage rates.
However, this news is being overshadowed by news from the White House that the President will try to impose regulations restricting the size and activities of the largest financial institutions. Even after Goldman Sachs reported better than expected earnings the financial sector is leading the stock market lower which is helping mortgage rates remain low.
Later today the US Treasury will announce the size of its 2-year, 5-year, and 7-year note auctions next week. Analysts expect $118 billion in supply. Any number north of this would likely lead mortgage rates higher.
Given that 30 year fixed rates are at or below 5.00% I recommend a locking bias.
Current outlook: locking bias