Mortgage rates eased this morning.
Mortgage-backed bonds finally rallied yesterday after 6 straight days of losses.
This morning tame inflation figures reported by the Labor Department could help rates move lower.
However, as I pointed out in yesterday’s ‘rate update’ there are many other factors influencing the direction of mortgage rates than the standard inflation & stock prices that we typically follow. In fact, this morning an article on Cnnmoney.com made the argument that a greater supply of US treasury bills over the next few months, used to pay for the $700 billion rescue plan, will push yields higher. This is a negative indicator for mortgage rates.
For now we’ll continue to float into the rally in the bond market but our outlook for future dips in mortgage rates is souring.
Current outlook: floating