Rate Forecast for June 18, 2010
Here are some of the events affecting mortgage rates today:
What Mortgage Backed Securities Are Doing Today:
- The price of the FNMA 30-Year 4.5% MBS coupon opened at 102.97 this morning - the same as yesterday's close.
- At 9:30 AM, the 4.5% MBS coupon was trading at 102.94 - down 1/32 from its opening.
Remember, on mortgage backed securities (MBSs), as the price goes down, the yield goes up - and so do mortgage rates. I expect that mortgage rates will be the same in price this morning as compared to yesterday.
Price Trend in Mortgage Backed Securities:
The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days from 5-19-2010 to 6-18-2010:
Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:
- There are no economic reports scheduled for release today.
In other news, today is "quadruple witching" day. Quadruple witching refers to the expirations of options and futures contracts that can cause increased volatility in the stock markets. While it has no direct impact on the bond or mortgage markets, this sometimes leads to funds being moved into or out of bonds and mortgage backed securities. Mortgage rates usually are not affected unless the major indexes experience significant swings.
Trend in Mortgage Rates:
The chart below shows the trend in mortgage rates over the past year:
Mortgage Rate Lock Advice:
Mortgage rates have returned to their lows of the year. Yesterday, the price of the FNMA 30-Year 4.5% Coupon closed at 102.97, which is only 6 basis points lower than its all-time high of 103.03. After the open this morning, the MBS coupon rose in price, and is now within 6 basis points of its all-time high.
While it's still possible that mortgage rates could go even lower with the ongoing economic crisis in Europe, it won't be by much. So, I would not risk the chance waiting for it.
If I was closing within the next 5 - 7 days, I would lock in the rate.
If you are closing in more than 7 days, send me an email to get my rate lock advice.
Be sure to check out today's mortgage rates.
East Bridgewater, MA 02333
Lew Corcoran, ASP®, IAHSP, IAHSP-CB