Mortgage News

Market Comment - Week of June 13th, 2011

Mortgage bond prices fell last week pushing mortgage interest rates slightly higher. There were large swings throughout the week. Rates were pressured higher Monday morning. Bonds rallied mid week following Fed Chairman Beneranke's comments about weakness in the economy which helped stabilize rates. Unfortunately strong stocks and a weak 30Y Treasury auction Thursday erased the improvements seen Wednesday. Mortgage bonds ended the week worse by about 1/8 of a discount point.

The inflation data this week will be significant. If inflation exceeds estimates on the consumer or producer side we could see a spike in mortgage interest rates. Tame inflation readings are always welcome.

Oil

Inflation fears tied to rising energy prices remain on the minds of traders. OPEC failed to raise production levels and many are preparing for large price spikes throughout the rest of this year as demand increases and supplies remain the same. Recent forecasts call for prices to skyrocket off the already high levels. That would be a disaster for the wobbly economy. The fate of mortgage interest rates in a scenario like that is even more uncertain. A US representative cautioned that the use of the US Strategic Petroleum Reserve might be necessary to "head off an economic collapse from continued high gas prices."

WR Starkey Mortgage, LLP - A different kind of company...where people come first!

©2011 Design by WR Starkey Mortgage, LLP NMLSR #2146. This is not a guarantee of financing. All borrowers must meet certain underwriting guidelines and credit criteria. Rules and Regulations may apply. Colorado: To check the status of your mortgage loan originator, visit http://www.dora.state.co.us/real-estate/index.html If you would like to be removed from receiving these newsletters, Click Here type REMOVE from Mortgage News.