MBS Headed South - Bad News For Mortgage Rates

Mortgage Backed Securities (MBS) have again headed South as they are unable to mount any type of rally to challenge the resistant levels.  This is bad news for Mortgage Rates.  This morning’s economic data was negative for pricing coupled with China’s news of it’s wholesale inflation numbers.

Import Prices was expecting a negative number, but import prices rose by 0.1%.  This report can rally impact sub-assembly and final costs which is a core of inflation.  Even though this was not a huge miss, we did see a selloff in MBS after this report.

We did see weaker than expected numbers from Industrial Production and Capacity Utilization, and even though this bolds well for MBS, the weather issue seems to be in play in the minds of the traders as again it seems that this number is not being looked at because of such.

The big number regarding Consumer Sentiment was much stronger than expected and MBS has headed lower since the release. 

With all this, the Bond Market was searching for a level of support and I do not believe it has found such.  My recommendation is you certainly can cautiously float but the best move might be to lock if you are going to close within the next 30 days.

If you have any questions with regards to your financing, give me a call at 314-744-7806, or visit our website at www.CallTheMoneyMan.com.