Danny Salas

Chico, CA Interest Rates Market Report – Economic Influences – April 27, 2010

Trouble In Greece Is Helping Our MBS

Greece X

The uncertainty, in Greece, has caused investors to park their investment funds in the safe-haven of U.S. Treasuries and Mortgage-Backed Securities.  We’re currently up 34 Basis Points and we’ve broken through the very tough ceiling of resistance, at the 50-Day Moving Average. The biggest concern is, can we remain here?  Will The European Community save the day, again, for Greece?  Will money pour back into the Euro, if a resolution results?  These are questions that continue to go unanswered, however, will have significant implications on interest rates.

Earnings Reports

For the most part, earnings have been stronger than I had anticipated.  We ran into this last year, and my calculations were a few months behind, and that might be what’s happening, currently, as well.  While I am extremely excited for the United States, and the rest of the world, to climb out of this financial nightmare, while trying to remain optimistic, the reality is that until the labor market experiences more significant growth, the economy will continue to drag its ugly tail.

Consumer Confidence

As if to slap me right in the face, for my labor comments above, Consumer Confidence sharply catapulted to 57.9.  This is the highest reading since September of 2008 and significantly higher than last month’s disappointing 52.3 reading.  Consumer Confidence is so important because it measures the willingness of the American People to spend money; boosting the economy.

Fed Meeting Starts Today

The Federal Open Market Committee opens their two day meeting today.  Their Rate Decision and Policy Statement will be released tomorrow, after the meetings, at  11:15 PST.  you can rest assured that the high Consumer Confidence Numbers will be a matter of discussion.

Treasury Auction Starts

Today, $44 Billion worth of 2-Year Treasury Notes will be auctioned off, starting the week off of 2, 5, & 7-Year Treasuries.

Greece's Troubles Are Helping Rates

Locking Advice

Now, is the time to float…however, EXTREMELY carefully!  We’ve managed to climb above some very tough resistance.  And if another resolution to Greece’s troubles is negotiated, money could fly from the U.S, and back to Europe.  However, if not, we could see even better pricing.  Register your loans for locking…but wait until the news changes, before doing so.  It sure is a bumpy ride, however, you knew it was coming.

Related Must Reads

Related Must Reads From Greece
Earnings Surprise: A Look Back At October of 2009
Why Be Leery: A Look At Short Term Treasuries Desirability Compared To Long Term Treasuries

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This entry was posted on Tuesday, April 27th, 2010 at 7:49 am and is filed under Chico Home Loans, Home Buying, Interest Rates. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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