Pricing on mortgage rates is mostly better this morning than it was yesterday morning.
Interest rates improved as the day went on yesterday. Investors are searching for a story which would suggest healthy economic growth but unfortunately the combination of European fiscal woes, stock market volatility, and high unemployment are overshadowing everything else. A negative economic outlook is good for mortgage rates.
The Treasury Department released data this morning that showed that both China and Japan increased their US Treasury holdings in April. For the third month in a row foreign buyers are stepping up and creating substantial demand for our debt. The strong demand translates to low yields.
On the inflation front the Labor Department reported earlier that US import prices grew at a slower pace than expected in May. Low inflation is good for mortgage rates.
I remain in a neutral position.
Current outlook: neutral