12/19/07 - 8:13PST Minimal Change

No major reports released today that affect mortgage bond prices.

Stocks are flat currently

Mortgage applications were down more than expected. 

The FNMA 30 YR Fixed MBS 6.0% coupon is at a 101.24 bid currently.  This is fairly strong with respect to the last 3 weeks. 

30 YEAR FIXED PAR RATE: 5.75%

LOCK COMMENT: Technical factors (the amount that the bond price has climbed above moving averages) suggests locking short to mid term.  If you keep an eye on stocks and any inflation related data (oil and dollar), you can likely float through the afternoon.  Tomorrow is a huge news day, with the final revision of the GDP, jobless claims, the LEI report, and the Philly Fed survey.  Floating into tomorrow is risky considering the relatively high bond prices now, and will only pay off if the data is bond friendly.  Longer term lock recommendations depend entirely on inflation concerns.  If you believe inflation concerns will decrease, then float.