Mortgage rates are priced slightly better this morning.
To quote the WSJ’s Heard on the Street column this morning, “Welcome back, euro crisis.” Ughhhh… We thought we had put the European debt crisis in the rear-view mirror after European finance officials agreed to increase the capacity of the bailout fund to over $1 trillion last month. However, Spanish bond yields have moved sharply higher in the past week thanks to economic reports which show that their economy continues to struggle. As long as there are questions about the stability of the EU’s financial system mortgage rates in the US will remain relatively low thanks to investors seeking “safety”.
Weekly jobless claims fell to the lowest level in 4 years last week according to new data from the Labor Department. Tomorrow’s all-important jobs report is expected to show about 240,000 new jobs created by the private sector. Typically, if the report shows better-than-expected job growth it causes rates to move higher and vice versa. But, with the resurgence of attention on the European debt crisis we may see a muted response.
Current Outlook: neutral