The Mortgage Interest Rate Lock Advisory for Truro MA for January 26, 2010
Here are some of the events affecting mortgage interest rates today in Truro, MA.
What Mortgage Backed Securities Are Doing Today:
- The price of the FNMA 30-Year 4.5% MBS coupon opened at 100.84 this morning - the same as yesterday's close.
- The 4.5% MBS coupon was up as high as 101.06 this morning, but is now trading at 100.94 - up just 3/32 from its opening.
Price Trend in Mortgage Backed Securities:
The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days from 12-27-2009 to 1-26-2010:
Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will be up to 0.25% better in price this morning as compared to yesterday.
Economic Reports, News, and Events Affecting Mortgage Interest Rates Today
- Consumer Confidence Index (CCI) for January - consumer confidence for January rose 2.4 points to 55.9. Posted by the Conference Board, this measures consumer willingness to spend. As a comparison, a reading of 80 or better is considered a signal of economic health. Retail sales typically move in tandem with consumer optimism. Because consumer spending makes up two-thirds of the U.S. economy, any related data is watched closely by market traders and can have a significant influence on the mortgage market. If consumers are more confident in their personal financial situations, they are more apt to make large purchases. The higher CCI readings lead to higher mortgage interest rates this morning.
In other news, the S&P/Case-Shiller® Home Price Index report for November revealed a 0.2% decline in home prices in the first 2 months of the last quarter in 2009. This follows a 0.1% decline in October.
The Treasury Dept. will auction $40 billion 2-Year Notes today. If there is a strong demand for bonds, mortgage rates should improve this afternoon. However, weak demand for bonds will likely push mortgage rates higher.
The Federal Open Market Committee (FOMC) meets again today and tomorrow. The FOMC meets once every 6 weeks to discuss domestic monetary policy. The FOMC will release a statement at 2:15 pm tomorrow afternoon.
What's Happening With Mortgage Interest Rates Today:
Moderate to High Volatility. Mortgage interest rates are still at historic lows. There's not much potential for MBS prices to tick higher (lower mortgage rates) as the Fed begins winding down their stimulus programs soon as it appears the overall economy is improving. There's also the fear of inflation.
If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. It's better to have locked when you should have floated than it is to float when you should have locked.
Mortgage rates are currently improving. If you have not yet locked in your mortgage interest rate yet, please proceed with caution and maintain contact with your mortgage professional and rates can change for the worse - often without notice.
Get current mortgage interest rates for your situation in Truro, MA.