Rates dropped .125% last week. This after dropping three straight weeks beginning July 25 then staying flat two weeks. The downtrend began with awful Q2 (and Q1 revised) GDP, then a mediocre-at-best July jobs report, then S&P’s U.S. downgrade. Below are specifics on this rate downtrend, plus September’s rate outlook. RECORD LOW FOR 10YR NOTE
10yr Note
For the first time in history the yield on the 10-year Treasury Note closed below 2%. It closed today at 1.996% yield. The day of the Lehman BK was the only other day it went below 2% but on that day it closed at 2.03%. We are in uncharted territory and could see record low mortgage
-8 Reasons I’m Glad I’m American (LendingTree via FiscalFizzle) -Bair Expects FDIC Fund To Turn Positive In June (HousingWire) -PIMCO’s MBS Head Scott Simon On Housing Outlook (PIMCO) -Time To Be Bullish On Homebuilders? (TradingFloor.com) -Guide to SEC’s Securitization Reform Plan (MortgageOrb) -Corcoran On What Homebuyers Get For $400k (MSNBC) -US 10yr Treasury Yields Exploding
Yesterday’s early-week rate outlook said to hold on locking rates until just before tomorrow’s post-FOMC meeting press conference, and we’re sticking with that given today’s weak February home price data as well as stock and bond trading signals. The S&P Case Shiller February 2011 report of existing home prices showed average U.S. home prices declined
Stocks rebounded a bit today after deep losses yesterday after S&P issued a negative outlook on the U.S.’s ability to meet its debt obligations. Treasury Secretary Tim Geithner tried to steady the ship today, saying “There’s a lot of confidence in the capacity of this economy to grow, to make sure that we can meet
A lot of economists are saying today’s S&P’s negative outlook for U.S. debt is ‘no big deal’ but markets are reacting otherwise. Stocks are down sharply (Dow -212, S&P 500 -21) and bonds are continuing Friday’s big rally (FNMA 30yr 4% coupon +31 basis points, 10yr Note +34 basis points). Our WeeklyBasis report Saturday predicted
After a big bond rally yesterday that helped rates by about .125%, mortgage bond markets are flat today as decent March retail sales and a not-so-good $21b 10yr Treasury note auction are canceling each other out. Stocks are down slightly with S&P -2.5 and Dow -16.7. [UPDATE: Good rate news: FNMA 30yr 4% coupon rallies
Inflation is the theme driving rates higher this morning as mortgage bonds (FNMA 30yr 4% coupon) are down 22 basis points and the 10yr Note is down 31 basis points to yield 3.59. Average 30yr fixed mortgage rates (on loans to $417k) had been holding just below 5%, but if this selloff holds, it would
Monthly Payments on U.S. Debt Since early October, the 10-year US Treasury yield has gone up about 85 basis points (from 2.4% to 3.35%). The crisis in Europe and the Fed’s $600 billion bond-buying program (QE2) in theory would move rates lower. But a pick-up in world economic indicators, along with concern over a growing
Mortgage bonds are ‘only’ down 40 basis points after today’s ok 10yr Treasury auction results—it was actually worse and just rebounded a bit. Four ongoing mortgage bond market themes have caused a huge selloff in recent weeks: QE2 is focused on Treasuries and not mortgages, modestly improving economy, Chinese inflation, and profit taking after a
No one will argue that volatility has increased recently in the fixed income (and therefore MBS) markets, and that only a few folks out there (traders) are enjoying it. Loan agents (and their clients) who locked prior to yesterday are pleased, but concerned about closing their loan prior to lock expiration. Anyone hedging a pipeline
What Do Manufacturing & Inflation Stats Mean? Economic stats often point to different economic trends, depending on one’s viewpoint. What difference do numbers like Industrial Production, Capacity Utilization, Producer Price Index, etc., mean for anyone in the mortgage business? Aside from moving rates around, last week we saw strength in manufacturing production (pushing commodity prices
What Do Manufacturing & Inflation Stats Mean? Economic stats often point to different economic trends, depending on one’s viewpoint. What difference do numbers like Industrial Production, Capacity Utilization, Producer Price Index, etc., mean for anyone in the mortgage business? Aside from moving rates around, last week we saw strength in manufacturing production (pushing commodity prices
Current Financial Reform Bill Status The House-Senate conference committee is where the action will be on the Financial Reform Bill. Several key issues will have to be resolved there, including restrictions on derivatives trading by banks, mortgage broker compensation and yield spread premium, the proposed liquidation fund to be financed by financial firms and the
Water (or Beer?) Consumption By Sports Fans Who says that numbers aren’t fun? A top muni bond analyst at Wells Fargo sent this chart to me. California’s 2009 Home Buying Stats In California (state motto: “By age 30, our women have more plastic than your Honda”) last year 47% of all homebuyers were first-time homebuyers,
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