Mortgage Rates at High Mark of 2015

Mortgage rates remain at the high mark for 2015. The scary thing is that the past 3 days have actually been very well contained in terms of market movement.  Historically, that's not the kind of thing you want to see when rates are near their highest levels of the year.  If we must face the year's highest rates, it's preferable to see a huge, 1-day move to the highs that ends up bouncing just as hugely back in the opposite direction.  Instead, we've moved up with relatively little protest and obviously without a burning desire on the part of market participants to move back down.

EU finance ministers closed down for the night with nothing done. They said it was to give Greece a chance to and creditors more time to agree on something. No common proposal, two of them being kicked around but neither is acceptable to the other. Meanwhile EU leaders were preparing for a separate meeting. Brussels must be beautiful this time of year, certainly crowded with politicians these days. June 30th is coming quickly - how will the IMF react if Greece fails to make the payment due?

US stocks and bonds continue to drift - Greece takes the stage even though today’s very strong increase in personal spending did not get any noticeable reaction. The US stock market as well as US interest rates are trading in a sideway drift. The stock indexes increasingly look like a correction may be coming. One thing we note is the big rush of IPOs recently - at times that has been a precursor to a decline in the markets.

This afternoon’s $29B 7yr note auction met with good demand. Tomorrow the final July U. of Michigan consumer sentiment index is expected unchanged from two weeks ago. That is all there is tomorrow.

In summary, tomorrow should be quiet in US markets. There is not anything going to occur in the Greek debt meetings until over the weekend, that should keep the interest rates market fairly well contained until Monday at least. Once again, the US bond and MBS markets remain in bearish patterns. Keep in mind that next week could be extremely volatile with markets being closed Friday and the big Jobs report on Thursday.