Good Morning,
It has been a very volatile morning in the market. Negative news from JPMorgan and the continuing fluctuations in oil prices pushed investors to pull out of the stock market and invest in bonds. We will see a slight improvement in mortgage interest rates today.
Here’s the inside Dripp…
Souring mortgage debt in the financial corporation JPMorgan has shown wider losses so far in the third quarter. Today, investors have been pulling out of the stock market, primarily from the financial sector, and rallying in the bond market. This will help interest rates today, but not to the extent that we would all like because the spread between the 10-year bond price and mortgage interest rates continues to increase. Check out some of our previous posts to gain a greater understanding of this. The next couple of days should prove to be very interesting. I am drawn primarily on the Consumer Price Index (CPI) being released on Thursday because of the implications it has on inflation. Inflation hurts the bond, so rates can be dramatically affected if the actual figures are far off from the forecasted ones.
Simply Put: Another Bond Market rally has helped interest rates today due to JPMorgan’s report that losses due to mortgages have already been greater in the third quarter than the second. Keep your fingers on the “DEAL” button to lock in your rates if you are refinancing or purchasing a home and keep your eyes open on the increasing fees that Fannie Mae will continue to implement. Here is a very informative article from CNN Money about this… Mortgages get more expensive - again.
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