Rate Update January 9, 2009

Fixed mortgage rates are even with yesterday.  

 The Labor Department reported this morning that there were 524,000 jobs lost in December, which is worse than the expectations of 500,000.  The finally tally for 2008 was 2,600,000 jobs lost (which does not count Adam “Pacman” Jones who was released by the Dallas Cowboys earlier this week).  Of the 2.6 million jobs cut in 2008…1.9 million came in the last three months!!!!  These weak numbers didn’t seem to do much for bonds in early morning trading as they are still trading down about 16 basis points on the day.

 The Fed announced yesterday (remember they will release figures each Thursday) that they purchased 10.2 billion dollars of Fannie Mae, Freddie Mac, and Ginnie Mae Mortgage backed Securities.  This increased demand kept bonds trading sideways to slightly higher during the week which caused rates to stay low.  We expect this pattern to continue and keep rates low for the coming weeks BUT bonds are up against some heavy technical resistance so it will be interesting to see if this increased demand has enough power to break through.  If not, we could see rates bounces around a bit more causing more volatility.

 Outlook:  Floating long term, locking short term  

The views and opinions expressed in this site are those of the author(s) and do not necessarily reflect the official policy or position of Cherry Creek Mortgage Co., Inc. This is for informational purposes only. This is not a commitment to lend.