Mortgage rates were unchanged again today. If you slept through the week and woke up this afternoon you would believe it was a quiet week. MBS prices and rates unchanged, and the 10yr yield hardly changed. This week was volatile, last week also volatile both the first since mid-July. It started a week ago yesterday with the ECB saying it was satisfied with its QE, according to Draghi the EU is improving and the stimuli is working. Then both August ISM indexes (manufacturing and services) declined leading to increased thoughts the Fed would hike rates next week. This week that went out the widows with all the other previous ideas that the Fed would increase rates.

Next week the main event is the FOMC, with the opening act, the meeting of the Bank of Japan. Data next week: Monday Sept NAHB housing market index, Tuesday August housing starts and permits, Wednesday FOMC and Yellen press conference, and Thursday August existing home sales.

The momentary bearish outlook for interest rates remains strong. If there is more improvement coming it will have to be built on some surprising event that markets are unaware of now. I believe stocks will remain volatile - underlying the recent volatility and not much change this week is the belief that any dip is another buying opportunity. One day investors will be crushed with that belief but that may be months or years away. Central Banks still holding equity markets up with their support.

In summary, while the stability is good, the outright levels are still higher than they were. In fact, with the exception of Monday, this week's rates are the highest in more than 2 months. The silver lining is this "high" is still pretty darn low historically. I do not see much benefit in floating right now. The trend continues to not be our friend right now. Potential volatility remains at least through next Wednesday's Fed meeting.