What's going on and why does it matter?
Financial markets are cautious ahead of this afternoon's release of the Fed minutes from their meeting earlier this month. No surprises are expected, and the minutes will likely confirm the Fed's commitment to increasing rates sooner rather than later. The market will be looking for more details as to the timing of when the Fed plans to stop or slow down it's 9-year mortgage bond buying program. The president of the European Central Bank is scheduled to give a speech this morning in New York, and this may also cause a market reaction. The Fed will be supportive of mortgage bonds today with a scheduled purchase of up to $1.625 billion of 30-year conventional mortgages.
What should you do about it?
Watch for mortgage bonds to rebound off their 30-day moving average; but be prepared to lock your rate quickly if bonds break below that level.