Rate Update for September 2, 2008


Mortgage rates are up across the board today.  We shifted our outlook to a locking position on Friday and our shift proved timely.

We alluded to technical trading patterns on Friday as a reason to lock and mortgage-backed bonds have now broken below the 100-day moving average which is partially why rates have moved higher.

Watch today’s you tube video to understand why we think lower oil prices will initially cause rates to rise but then move back lower. 

Current Outlook: locking in near term but recommending a long-term floating stance

Rate update August 15, 2008

Rates are effectively unchanged again this morning.

Following yesterday’s hot CPI data we got a slew of inflation related news that is helping support mortgage-backed bond prices today.

*Gold prices are finishing the week with one of the steepest weekly declines since March.  Gold prices tend to reflect the market’s future inflation expectations so the fact that prices are coming down is a good sign for future inflation.

*Oil prices also continue to fall.  Crude oil is now trading down around $112 per barrel which is over 20% off recent highs.

Lower energy & commodity prices bode well for mortgage rates because they will help to ease inflationary concerns. 

However, we remain concerned about the technical trading picture for bonds.  Bonds face significant overhead resistance which is why we continue to favor locking. 

Current Outlook: locking