Mortgage Rates Saw Improvement “Again” Today

Mortgage rates saw something new today for the first time in two months – improvement again.  Rate markets began soft this morning but found support as the day went on, then gave up at 2:30PM. Still about the coming referendum in Greece scheduled for Sunday as it stands now. Some polls from Greece indicate that more Greeks want to stay in the EU than leave it. Greece has defaulted in its debt payment to the IMF, really not a surprise. Greece requested a new bailout amid a last-minute diplomatic push on today, hours before the country’s current rescue deal was set to expire. The Greek government said it submitted a proposal for a two-year agreement with the euro-zone bailout fund to cover its financing needs and restructure its debt.

Other world news is coming from Shanghai and how their markets have been extremely volatile, as well as news Puerto Rico is now bankrupt - another country in a debt crisis.

Tomorrow June ADP jobs report, June ISM manufacturing, and May construction spending. Still most attention on the EU. The referendum still on tap for Sunday but given the continual uncertainty about everything and anything in the EU by Sunday who knows where the situation will stand. EU cannot give much more unless it sets up a rush for debt relief for other EU countries. The 1998 EU and euro currency finally does not look like such a good idea.

In summary, slightly better today in the bond and mortgage but still technically bearish. Even the present chaos in Greece has not caused a big run to safety - suggesting investors are holding on that a deal will get done and if there is a vote on Sunday it will be for Greek officials to accept the austerity keeping Greece in the EU with a debt extension that will continue to be refined and argued until the end of time. Stanley Fischer talking today about the Fed’s plan to increase rates, another story that has no end - maybe the Fed will, maybe not, pending uncertainty. Fed officials need to rest a little, go fishing or read the unabridged dictionary. For all of the angst around these days there has been very little movement into safe haven places like US treasuries.