Mortgage Rates Rise! Evergreen Colorado Market Update
The news today is Mortgage Rates Rise, but suprisingly, the rise in rates cannot be solely attributed to the end of the Fed's mortgage backed security purchase program. Strong economic data in the form of good 
jobless claim numbers and a much better than expected ISM Manufacturing reading has sent bond prices falling (see chart), and the trend (arrow) is down. Lower bond prices = Mortgage Rates Rise.
There is also a lot of fear in the market with tomorrow's employment numbers to be released on a light trading day as well as the announcement this afternoon on the Fed bond auction for next week. The next level of support in bond pricing lies well below current levels, and panic selling could ensue, especially with the psychology of the end of the MBS program.
However, it should be noted that the Fed has not ended it's efforts with treasuries, and treasuries have also fallen at about the same rate today as MBS. Therefore, it is logical that the end of purchase program is not the only factor that has caused Mortgage Rates Rise.
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