Daily Commentary by Larry Baer: Mortgage interest rates are feeling a little
upward pressure this morning as signs of progress in talks to resolve a fiscal
crunch here in the states have boosted stock prices at the expense of Treasury
debt obligations and agency-eligible mortgage-backed securities.
Leading Republican
and Democrat lawmakers expressed confidence on Sunday that a deal to avoid the
so called "fiscal cliff" could be reached before the clock strikes
midnight on December 31st. Confidence can be a fleeting
thing. Investors will be watching intently to see if this spirit of political
bipartisanship prevails after Congress returns from its current Thanksgiving
recess on Monday, November 26th.
Trading activity in
the mortgage market will begin to fade rapidly in the run-up to the Thursday's
Thanksgiving Holiday - and interaction between buyers and sellers will likely
be exceptionally thin during Friday's shortened trading session. Expect
unusual and erratic swings in your rate sheets prices and to a lesser degree
note rates during this period of time.
The National
Association of Realtors reported earlier this morning sales of existing homes
advanced in October at its second fastest pace in almost two years.
Existing home sales were up a slightly stronger-than-expected 2.1% on a
month-over-month basis and up 11% above their level one year ago. At 5.4
months of inventory, supply has hit its lowest point since mid-2006 relative to
sales. The pace of sales remains below the 5.5 million mark that would be
considered by most analysts as normal - but it is still a welcome reversal from
the trend of the previous six years.
THE
MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
