09 Nov Locking bias
Mortgage rates continue their uphill climb that has been fueled by Friday’s Bureau of Labor Statistics (BLS) report on the job market. At this point, bonds are sitting at a critical level where breaking lower would lead us to see mortgage rates move higher. This seems to be a likely scenario based on the markets’ expectation as to what actions the fed will take at their December meeting. With the general consensus of a rate hike increasing, most are positioning their portfolios for higher interest rates. Where it has been many years since we have experienced a rate hike, there is a general fear in most markets.
The stock market is under significant pressure as well this morning. Although this should be helping improve mortgage rates, it so far has not been of benefit to mortgage bonds.
With mortgage bonds continuing to be under pressure, the safe play will be to lock.