Weekly Rate Update - 3/27/2006

Mortgage rates were essentially unchanged last week. The first half of the week was a continuous slide in the bond market. This caused mortgage rates to rise somewhat. Fuel was added to the fire on Thursday when existing home sales came in higher than expected. The fire was doused on Friday when the new home sales numbers came out lower than expected. The bottom line is that it's difficult to determine which direction the housing market and the economy in general is heading right now.

This week should be an interesting one with Ben Bernanke heading up his first Fed meeting. Most folks are placing their money on another 1/4 point hike, if for no other reason than to show that he is going to be tough on inflation. Word on the street right now is that Bernanke may not be as tough as Mr. Greenspan was.

Keep your eye on the news media. They seem pretty upset with the February existing home sales number. It flies in the face of their trumped up housing bubble and they will spend the next month trying to find as much doom and gloom in the numbers as possible. One day, perhaps they will look at the numbers that matter when predicting housing bubbles - unemployment and jobs creation. And right now, those numbers are too strong to indicate a bubble.