Mortgage Bonds are trading near unchanged levels this morning as they hover near a firm resistance level. Bonds have not been able to move above this level since early October, when Bonds traded above this ceiling for only a few short days. Prior to that, it was May of this year when Bonds rose above this ceiling.
Consumer Sentiment came in lower than expected but this is not much of a surprise. The media has been beating the drum in seeming attempts to rouse some euphoria…and while Wall Street might be buying it temporarily, Main Street isn’t.
The Fed bought more Mortgage Backed Securities yesterday, helping Bond prices recover from news of a weak Treasury Auction. Overall, Fed purchases will continue to decline as the program winds up. Remember, as the Fed winds down their buying support, this will be a contributing factor in Bond prices moving lower and home loan rates rising over the coming months.
Next week will be loaded up with high impact economic reports, including Retail Sales numbers and a look at inflation with the Producer Price Index and Consumer Price Index. Check back to stay in touch with these releases and learn how they affect mortgage rates.
Friday, November 13, 2009
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