Mortgage Rates September 15, 2015
I have a locking bias today. CPI comes out tomorrow and there is the potential for that to push us into the 2% range for year over year inflation, which is getting to the Feds target. That could cause some sort of selloff in bonds and raise yields. Then Thursday we have the rate decision. At this point, I think the guess is as good as heads or tails as it is so easy to argue either side of the coin. A strong CPI could make bonds sell off, but then it could give the Fed the ammo they need to raise rates which should actually lower yields; yes, this is a conundrum because if the number was strong and then they didn’t raise rates you could see the bond market selloff even more. After Thursday the only Fed rate decision meeting left is in December and then 2016 is an election, aka a very hard year to raise rates in. The reason for the locking stance is all these variables. Rates have been pretty stable the last month and half and there are potential headwinds these next few days.