Mortgage rates are unchanged this morning.
The economic calendar for the week kicked off today with a slew of data to sift through. The Commerce Department released it’s monthly retail sales report this morning which showed slower than expected growth. Bad news for the economy is typically good news for mortgage rates.
However, what is more concerning for long-term interest rates is inflation. The financial headlines were filled with inflation story lines today. First off, the Fed Reserve’s Empire State Manufacturing Survey showed that the index for raw material prices rose by more than expected in January.
Overseas the Chinese Government released inflation figures for January that showed consumer prices increased by 4.9% and producer prices increased by 6.8%. Furthermore, inflation prices in the UK were also released today and showed that consumer prices rose by 4% on a year-over-year basis. Currently, official inflation figures here in the US reflect a modest 1.5% increase. Therefore, concern in mounting that global price pressure will push prices higher here at home which would be bad news for mortgage rates.
We shifted to a floating position 2 days ago and benefited from a .125% reduction in rates. The longer-term trend remains unfavorable so I will shift to a locking bias.
Current outlook: locking bias