This morning we got the release of 3 economic reports.  First we got jobless claims which came in higher then expected and at the highest level since 1982.  Economist’s where expecting 525,000 but the number came in at 573,000.  This is mbs positive as higher jobless claims leads to less wage based inflation.  Next, came trade balance or as I call it trade inbalance, economists expecting a -$54.0b, but actual number was -$57.2b.  The last report was import prices which came in at -1.8%.  This report is very friendly to us as it shows that import prices continue to fall which leads to lower inflation.  Lower inflation leads to lower mortgage rates. 

Currently mortgage backed securities are trading above yesterdays close and at the highest level in quite some time.  We should see very good rate sheets this morning.   As for lock/float that is easy, float!!!!   

Stayed tuned to the blog and we will get back to you if we start to see a sell off.  We do have a treasury auction of 10yr notes later today which could cause a drag on mbs as the added supply of debt on the market could pull us down, but until that auction at 1pm est. we should be good to float.