BULLETIN - 12/18/07 - 9:34 AM Pst -

Keep an eye on stocks, oil, and the dollar.

Stocks are down since this morning's post, oil is down (good for inflation), and the dollar index is up (good for inflation).

If these three items hold or improve on their current levels, a mid day price improvement on mortgage rates is highly likely.

6.0% coupon FNMA MBS is at 101.31 which is 14/32nd's higher than yesterday's close.  This means that your lender's rates should be improved by .375-.5% of a discount point over yesterday's close.  Some have already priced in that large improvement, but others will release it later in the day (providing the market holds steady of course).

 Whatever the case, float through the afternoon as price improvements at the best lenders are likely, but do keep an eye on stocks, oil, and the dollar.