Interest Rate Predictions for 2010. Interest Rates on the rise currently.

After the December jobs report, mortgage rates rose all the way into the new year. This month the market is expecting more positivities from the labor market. If these forecasts are accurate, the bond market will not react well and mortgage rates will move higher. The reason I recommend floating UNTIL THE END OF THE DAY is because tomorrow the ADP Employment Report is released. This is a pre-cursor to Friday's NFP report. If tomorrow's ADP report implies the labor market is continuing to improve…mortgage rates will rise.

While a corrective rally would likely ensue if labor market data is worse than expected, floating is a very risky move. With that in mind I would recommend locking. There is much to lose if the jobs report is as expected. It would essentially confirm the month long trend of rising rates we dealt with in December. This would put a firm level of resistance under mortgage rates, making lower rates even more unlikely in the future.

via Mortgage Rates at Another Crossroads Ahead of Labor Market Data.

So, I hope you all read the entire article to really get a good prospective of where interest rates are heading. Now it is a gamble, however because of the historically low interest rates we have been enjoying one should conclude it can’t last forever. Just like the housing market had to burst, sooner or later inflation is going to catch up with us. So therefore the logical conclusion would be interest rates will be forced to go up in 2010.

I am going to cross my fingers that I am wrong and hope that interst rates will stay where they are at, however my gut is telling me by summer we are going to be seeing interest rates into the 6′s.. Now that is obviously my opinion, but if you look at all the leading indicators. I am willing you will come to that same realization. Interest Rates can not stay low forever. And for that matter we don’t want them to.. Inflation is the sleeping beast in the corner of the room.. Now for my local market of Utah Realesate, we definetly don’t want interest rates to tick up just yet, because that will have a direct effect on the false jump in the local Real estate market.. If people take advantage of the great rates, perhaps we can push the markets to have a little more breathing room?

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