Mortgage Minutes

Despite positive economic news released last week, mortgage rates improved an .125% (typically, good economic news negatively affects the mortgage market). The improvement can be directly related to the safe haven of mortgage-backed securities. With the request from Dubai for additional time to pay its debts, financial markets reacted globally moving out of stocks into bonds. Many economists anticipate this trend to continue this week as investors monitor the effects of the Dubai announcement. However, this is only one piece to this week’s puzzle. The broad range of economic news scheduled for release this week compounded with the continued scale back of mortgage-backed securities by the Federal Reserve will likely make for a volatile week for mortgage rates. While all of the reports could be potential market movers, investors will be anxiously awaiting Friday’s non-farm payroll report for an updated glimpse on the US economy. The anticipated estimate is 114,000 jobs lost in November and unemployment to remain at 10.2%. Most economist believe actual numbers would need to dramatically exceed the expectations for the mortgage market to reap any benefits – especially considering how incredibly low rates are currently. Stay tuned for updates on the mortgage market.