Weekly Mortgage Talk

Mortgage bonds prices fell last week applying significant upward pressure to mortgage interest rates. Trading was volatile throughout the week, as market participants remained concerned over the recent credit issues and inflation. Lower than expected unemployment and higher than expected average hourly earnings resulted in bonds falling considerably last Friday. Adding to the volatility were triple digit movements in stock prices throughout the week.For the week, interest rates on government and conventional loans rose by about 3/4 of a discount point.

The Fed meeting Tuesday will be the most important event this week. Trade data, retail sales, producer price index, consumer price index, industrial production, and capacity use data will also be important.