Daily Market Update 11/21/08

Mortgage rates inched higher Friday as stocks attempted to recover from steep losses earlier in the week. Treasury markets continued to out-perform mortgages, with yesterday’s yield on the 10-year Treasury hitting 2.99%, the lowest level since 1962. The unusually wide spread between Treasury and mortgage rates is resulting from uncertainty among traders over the government’s plan for Fannie Mae and Freddie Mac. Fannie and Freddie both announced yesterday they would suspend certain foreclosures until 1/9/09 in an effort to restructure borrowers’ payments. Rates are likely to remain volatile next week, with several key economic reports due out before the Thanksgiving Holiday.

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