Mortgage rates are currently unchanged.
Out of the chute this morning mortgage-backed bonds (MBS’s) are trading lower threatening to push rates back higher.
Since the Greek debt crisis emerged a few weeks ago I’ve been reminding readers that as soon as the EU is able to deliver a credible debt relief plan we can expect rates to reverse higher as the “flight-to-quality” trade unwinds. We may be seeing the beginning of that this morning.
Over the weekend the EU and the International Monetary Fund (IMF) presented a bailout package that totals nearly $1.0 trillion US. The package is designed to stave off problems in Greece and other vulnerable EU countries.
Looking ahead for the week we will be tracking the US Treasury’s auctions. They will deliver $38 billion of 3-year notes tomorrow, $24 billion of 10-year notes on Wednesday, and $16 billion of 30-year bonds on Thursday. Click THIS LINK to learn how government borrowing can impact mortgage rates.
Most if the significant economic data is scheduled for release later this week. I expect most attention to remain on the EU and for trade to remain volatile.
Current outlook: locking bias