Bonds and Mortgage Rates ended the week pretty much where they started. Mortgage Bonds remain above support levels and therefore I recommend floating, not locking into mortgage rates at this time. With little economic data and news out of Europe, the focus is now on next weeks Bond Auction, with $99 billion in added supply of 2, 5 and 7 Year T-Notes. The 3.50% coupon fell 22 basis points to $101.62.
Remember, Mortgage Rates move in the opposite direction of Mortgage Bond Prices.
Economic News
Weekly Initial Jobless Claims remained below the psychological 400,000 level for the third week in a row at 388,000. While the recent data is encouraging, the unemployment rate remains at concerning levels.
Housing Starts and Building Permits showed signs of improvement.
Consumer Price Index (CPI) fell by -0.1%, versus the 0.1% expected.
Producer Price Index (PPI) was better than expected in October falling -0.3% .
Index of Leading Indicators Rise 0.9% in October signaling stronger growth.
Retail Sales Rise more than expected, up 0.5% in October.