Rate Update June 14, 2010
Mortgage rates are worse this morning.
Better than expected economic data out of Europe is helping the outlook for the Euro debt crisis. As a result there is pressure on the “flight-to-quality” trade here at home this morning.
A report out of the EU showed that industrial output rose by a larger than expected clip last month. In response, the Euro is trading higher versus the US Dollar and stocks are up in early morning trade.
This is putting pressure on the bond market which is why mortgage rates are modestly higher this morning.
Three inflation related economic reports are due out this week. Since inflation is the primary driver of mortgage rates these reports can always shift the rate markets but all indications are that inflationary pressure remains low.
Current outlook: neutral