Mortgage Rates Experiencing Low Volatility
Mortgage rates are moving sideways thus far today. At 11:00AM, the 10yr is testing the resistant levels and is currently at 2.14%, with MBSs in positive territory at +17BPS. The last two days the market has experienced low volatility.
The Job Openings and Labor Turnover Survey (JOLTS) showed an enormous amount of unfilled jobs with 6.044M in April which was much higher than estimates of 5.650M. March was revised upward from 5.743M to 5.785M. While macroeconomists debate the concept of "full employment" and if we are there at a 4.3% Unemployment Rate, it is clear that a significant number of jobs are unfilled and that is due to a severe skill set gap.
A lot going on with the British elections looming, the $1B Qatar ransom payment, and other international issues. But domestically, President Trump is meeting with Republicans on tax and healthcare reform, and he is set to be making some infrastructure announcements.
Bloomberg reported that China is prepared to increase its holdings of U.S. Treasuries "as officials judge the assets are becoming more attractive than other sovereign debt and as the yuan stabilizes." Citing sources, Bloomberg adds that Chinese policymakers expect that U.S. government debt will be more attractive compared with other countries’ assets, and again confirming that China has recently stopped reducing its holdings of U.S. bonds.
Retail Sales on a MOM basis were lighter than expected (0.1 vs est of 0.2) but were stronger than anticipated on a YOY basis (2.5 vs est of 2.30).
I expect mortgage rates to once again move sideways with low volatility today. The only thing I can see that could move mortgage rates today is an unexpected tax reform announcement from the Republicans. (President Trump meeting with Republicans today).
The Job Openings and Labor Turnover Survey (JOLTS) showed an enormous amount of unfilled jobs with 6.044M in April which was much higher than estimates of 5.650M. March was revised upward from 5.743M to 5.785M. While macroeconomists debate the concept of "full employment" and if we are there at a 4.3% Unemployment Rate, it is clear that a significant number of jobs are unfilled and that is due to a severe skill set gap.
A lot going on with the British elections looming, the $1B Qatar ransom payment, and other international issues. But domestically, President Trump is meeting with Republicans on tax and healthcare reform, and he is set to be making some infrastructure announcements.
Bloomberg reported that China is prepared to increase its holdings of U.S. Treasuries "as officials judge the assets are becoming more attractive than other sovereign debt and as the yuan stabilizes." Citing sources, Bloomberg adds that Chinese policymakers expect that U.S. government debt will be more attractive compared with other countries’ assets, and again confirming that China has recently stopped reducing its holdings of U.S. bonds.
Retail Sales on a MOM basis were lighter than expected (0.1 vs est of 0.2) but were stronger than anticipated on a YOY basis (2.5 vs est of 2.30).
I expect mortgage rates to once again move sideways with low volatility today. The only thing I can see that could move mortgage rates today is an unexpected tax reform announcement from the Republicans. (President Trump meeting with Republicans today).
Comments
Post a Comment