Daily Market Update 11/18/08

Mortgage rates held steady Tuesday following the release of October’s Producer Price Index (PPI). Producer Prices fell 2.8% in October from September, largely due to falling energy prices. The more closely watched core rate, which excludes food and energy, rose 0.4%, far more than expected. The economic slowdown is expected to lead to lower future readings in the core PPI. Treasury data released this morning showed that China and other foreign countries remained big buyers of US bonds in September. If the trend continues, it would be good news for mortgage-backed securities markets, perhaps leading to lower rates. Stocks were generally higher.

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