Tuesday Market Commentary

by Alex Stenback on February 14, 2006

                                                        Graphic Courtesy  MSNBC
Last Week
Rates moved slightly lower higher (typo) last week as the market attempted to choke down 48 billion dollars in new bonds and treasury notes.  Foreign participation (which has helped keep rates low) was notably stong in the 30 year treasury re-issuance at 64.5%.  Nontheless, there was just a tich more supply out there than ready buyers were able to gobble up and prices (which move opposite of rates) eroded.
This Week
Full slate on the economic calendar with Retail Sales, Industrial Production, and Producer Price Index leading the list.  As we’ve said, what’s good for the economy is bad for the prospect of lower rates -  Mortgage bonds are in a downward trend (rates tending higher, see chart after the jump) so it may take some surprisingly weak figures to break out of this and move rates lower.
This Week’s Economic Calendar [barrons.com]


{ 3 comments… read them below or add one }

Zapiens February 14, 2006 at 9:46 am

I’ll take those 64.5% 30-year bonds, let me just sell my family into slavery…

Editor February 14, 2006 at 9:54 am

That would be, 64.5% of the offering was purchased by foeign investors.

Don’t think there’d be any problem moving that inventory if the yield were at 64.5%.

Mortgage Guy February 17, 2006 at 4:16 pm

Bernanke’s comments seem to imply that there won’t be constant rate hikes anymore–unless inflation rises. I expect one more increase in March, but hopefully things settle down after that.

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