Mortgage Rates Flat Again

Mortgage rates was again flat today.  I just hope that it is not the calm before the storm.  There was some market volatility caused by overseas events today as the European Central Bank (ECB) announced details of its quantitative easing program, and ECB President Draghi held a much-anticipated press conference discussing the bond-buying program.  Although seemingly very far removed from mortgage rates in the US, these sorts of European events have had a profound effect on domestic markets for several years now. 

With today's events leaving us flat, tomorrow's Jobs Report takes on even greater importance.  There is a good case to be made for the last jobs report serving as a wakeup call for rates.  Before that, we had seen the average jobs report have very little of its traditionally huge impact.  This may have changed with the last report due to the gains in wages--something the Fed has been talking about quite a lot as a missing piece of the economic recovery. 

Treasuries still barely holding key support at 2.12% on the 10yr, as the rate did jump to 2.14% but closed at 2.13% today.  Near term does not look to promising from a technical perspective.  The near term bearish, but my long term outlook remains somewhat constructive, as rates will likely increase – but after the dust settles in the over-baked stock market rates will not increase much from current levels.  In the meantime, and until I see more turns – I have to take it as it is.

In summary, monthly payrolls report will be released tomorrow morning prior to lenders issuing rate sheets. Rates could go either way. I do feel that the number of jobs created will come in less than estimates. However, I think of more importance tomorrow is the average hourly wages component. There is no way to look at earlier reports to get somewhat of a gauge on earnings. You would think if wages were rising, retail sales would improve, but February's report showed a decline much worse than expected. If you like the current pricing being offered, locking is the safest call. Float at your own risk.