Mortgage rates are priced slightly better this morning.
Sentiment for the outcome of Europe’s debt crisis has shifted once again this morning helping mortgage rates improve modestly. Investors became more pessimistic about this weekend’s meeting of EU leaders in Brussels after a German official told reporters that the markets should temper their expectations.
Also contributing to fears about the debt crisis was the announcement that a few European banks began utilizing central bank loans on Wednesday to meet capital requirements. Generally, central banks are the lender of last resort so this is an explicit sign that private investors are losing confidence in Europe’s ability to pull trough this crisis.
With no significant US economic data until tomorrow Europe will remain in focus. I still believe a locking bias throughout the week is the best approach.
Current Outlook: locking