What's going on and why does it matter?
Mortgage bonds opened below their 100-day moving average this morning for the first time since March. Mortgage pricing could deteriorate further if bonds fail to rebound back above that critical level in today's trading.
The Fed's mortgage bond buying activity today is limited to $975 million of GNMA mortgage bonds, while average new supply has been running at $2.2 billion per day. Wholesale inflation (PPI) came out this morning much higher than market expectations, and inflation of any sort is typically bad news for bonds.
What should you do about it?
Lock your rate to be safe.