Rate Update May 7, 2008

A report from the Labor Department showed worker productivity was better than expected in the first quarter. Furthermore, the report showed that labor costs increased less than economists had expected. Watch today’s you tube video to learn how productivity & labor costs can impact mortgage rates.

Despite the positive economic news mortgage rates have reacted to the stock market over the past couple days. When stocks have rallied mortgage rates have been pressured higher which is what we’d expect to see.
Mortgage-backed bond prices continue to trade just above important technical support. We are watching this level and hope that prices hold. If prices should slip we will shift our outlook to a locking stance.

Current Outlook: neutral with floating bias