Updating the Mortgage Rate

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Today's Rate Volatility: HIGH

What happened yesterday?

Mortgage backed securities (MBS) lost -35 basis points from Monday's close which caused fixed mortgage rates to increase and all but erased Monday's improvement in rates.

There were no major economic reports or U.S. Treasury auctions to guide MBS trades Tuesday.

Comments by Chicago Federal Reserve Bank President Charles Evans put the potential taper closer than what the market had recalibrated for due to Yellen's comments.  He stated "I'm not in a hurry myself to reduce the flow of purchase rate," Chicago Federal Reserve Bank President Charles Evans told reporters. "A couple more meetings to have greater assurance that the labor market improvement is sustainable would be quite welcome."

So, a "couple more" meetings would put that taper decision closer to March 2014 since the remaining FOMC meetings are December, January and March.

Remember, the further out the bond taper by the Fed is perceived, the better it is for your rates.  Those closer the taper and the more negative it is for your rates.

What is on the agenda for today?

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