Finally some news that should be positive for mortgage rates.  The 10 year treasury bond rallied pretty good today (yields down).  The yield dropped closed the day at 3.78% down from 3.92% just the other day.  All things being equal this should provide some relief to fixed mortgage rates from the drive upwards they've had the last week.

The main catalyst for this drop in rates were too awful economic reports this morning.  The Philadelphia Fed manufacturing index coming in at -24 vs an expected -10, where any negative numbers indicates contraction instead of growth.  The conference boards leading indicators came in at -.1 the forth straight month it's been negative also indicating growth contraction.  Kinda weird the conference board put out a nice fluffy report yesterday saying a recession is unlikely despite their own indicators showing we are most likely in one right now. 

Bond yields also tend to drop along with the stock market (which dropped today) as money makes a flight to safety from equities into bonds. 

 

 
Posted by Matt Heaton on 02/21/2008 07:06 PM   Comments (9)   credit markets  
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9 Comments on Nice recovery in the ten year treasury today

FEB
21
2008
381,187 Points 2 Featured Posts Outside Blog Attended Rain Camp
Matt put it in English for me what does that make mortgage rates??
7:17pm • #1
1,091,596 Points 57 Featured Posts
It means all else being equal we should get a little relief in the next couple days.
7:19pm • #2
158,848 Points 17 Featured Posts Outside Blog Called Shot Master

Matt, "Assuming ceterus paribus?" We just might see mortgage rates in the fours again.

Bill Roberts
7:29pm • #3
370,683 Points 18 Featured Posts Outside Blog Attended Rain Camp
There is a lot of cash in the markets looking for a place to rest. People just do not know where to put it. Inflation from printing too much money is becoming a big problem. Living beyond our means as a country and wanting even more. its a slippery slope. That is good news as I have been pushing some of my cliets inot ten year notes if the spread remains. Not many people stay even 5 years.
8:08pm • #4
1,091,596 Points 57 Featured Posts

"Inflation from printing too much money is becoming a big problem."

Who's printing money?  The inflation heavy inflation we've had during the last 5 years was caused by the expansion of credit.  This is contracting very rapidly now, deflation is the real concern, the commodity and equity markets as usual are just behind curve. 
8:12pm • #5
882,832 Points 50 Featured Posts Localism Sponsor Outside Blog Hit Router Attended Rain Camp
I'd like to see a little deflating at the diesel pump when I fuel up...   Not that I'm expecting to. 
10:22pm • #6
738,077 Points 231 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Matt.... it was a nice, refreshing day today. And even if the market is flat tomorrow, hopefully we'll pick up another 1/4 pt in pricing.  But it could be another good day for bonds tomorrow, because the Asian market is taking a beating. I just need some good results going into the weekend. As Eric mentioned, 10 yr.... but the best pricing right now is the 7yr and or 5 yr arms. 

jeff belonger
10:47pm • #7
FEB
22
2008
1,091,596 Points 57 Featured Posts
Bonds are very likely to get a lift from money rotating into them out of stocks over the next several weeks.  Lots of different indicators are now starting to point to a pretty big sell off in stocks in the near future.
12:19am • #8
Matt, I hope you are rigth.  I have a dozen refis waiting for a break in rates.  A good day tomorrow will be a very busy weekend. Thanks for the post. AJ
12:44am • #9


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Matt Heaton

Bothell, WA

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Timu Corp - CEO, ActiveRain - Co-founder

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