Monday Market Commentary

by Alex Stenback on November 21, 2005

21_nov_05
                                                         Graphic Courtesy MSNBC
Last Week
Mortgage bonds rallied (prices higher, rates lower) last week after CPI and PPI met expectations did not show significant inflation. This put some downward pressure on rates, but don’t break out the bubbly just yet – the market needs a reason, some fuel, to sustain the rally and drive rates lower still.
This Week
Speaking of fuel, this short week offers very little for the bond market to hang its rally hat on.  The minutes from the last FOMC meeting will be released, and barring any surprises indicating a shift in outlook (and the end of this tigtening cylce), there’s just not a lot to work with as traders, who are human by the way, look to get out of dodge for the holiday weekend.  It may take a significant selloff in the stock market for rates to move measurably lower.
ยท This Week’s Economic Calendar [barrons.com]

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