Mortgage bond prices opened lower following stronger than expected data this morning. Durable goods orders rose 3.4%, stronger than the expected 2.5% decline. This was the first increase in durable goods orders in 7 months.
This increase is not typically bond or rate friendly!
China remains concerned that the US Government continues to print money, devaluing their current holdings. China is the largest holder of US debt. While the current talk is some saber rattling during these times of uncertainty, the threat is being taken seriously by the financial markets.
The Fed will start buying Treasury bonds today, the New York Fed said yesterday afternoon. They indicated longer term Treasuries would be part of the buying which sent the 30Y up considerably. It will be interesting to see how the market reacts today to this.
New home sales, and a 5 year auction will take place later today.
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Thank you for your remarks. I will review your submission and post it accordingly. Dave.