This morning we received some economic data.  First the jobless claims, economists where expecting 525,000 but we got a better number of only 509,000.  This would be a negative for mortgage backed securities as we missed the estimate on the positive side; however the continuing claims came in worse at 4.087million after last weeks 3.962 and the highest level since 1982 causing a push.  Next we got factory orders and economists where expecting  -4.5%, but this came in worse at -5.1% which is a positive for mbs.  On this news, mbs started to rally and currently we are up on the day about 3 ticks but off the highs. 

Yesterday there was some news about a new plan by the Treasury to lower rates to 4.5%.  This is a rumor from unnamed sources and there are conflicting reports.  I read some of the reports which said this would be for purchase loans only, and I read other reports that this would be for purchase and refinance transactions.  Until we get an official announcement from the Treasury, I do not consider this to be relevant.    

Lenders are starting to pass along the improvements we have be seeing onto their rate sheets and we should see very good pricing this morning with rates at 5% or lower.   We are approaching some resistance overhead, so stay tuned and we will alert if you should lock, but for now float club is in session.