Flight to Safety... Rates IMPROVE

This morning we were down while waiting for the treasury auction results for the 10 year auction that went off earlier today. Although the results were not as strong as they could have been, they did support the current buy trend which forced treasury yields back down to current trading levels.

This market reaction sent the mortgage backed securities market into new territory squashing recent resistance levels which turned into today's afternoon trading support levels.

Up only 4 ticks on the day regardless we have broken the 103 price point on the 4.5% note coupon, and the 4.000% coupon is currently trading above 100. If we have a strong day of trading tomorrow we can expect very attractive rate sheets from virtually all lenders. With that said, lenders have yet to reprice these gains into their rate sheets and I doubt we will see better pricing this afternoon.

If you are currently floating your rate I would wait until tomorrow morning before considering locking. Open rate sheets tomorrow should offer better pricing than is available currently, but more importantly these auction results suggest these low rates are here to stay for some time.