Mortgage rates bounced around a tight range for most of the week. There wasn't much in the way of news to motivate movement in the first three days of the week. Although we did get several key earnings releases, the economics calendar was essential empty and the market's general tone reflected a lack of conviction. Rates were unchanged on Monday, rose modestly on Tuesday then recovered from weakness on Wednesday only to give it back positive progress on Thursday after the Treasury announced the terms of next week's debt auctions. This left rates a few bps higher (vs. Monday) heading into today.
Our week wrapped up with two sets of economic data and some unexpected headline news.
The bond market arose this morning to news that Greece had asked the European Union and the IMF to activate their financial rescue package. This request was seen by stock markets as a good thing as it seemed to signal the beginning of the end of a long, drawn out debate over whether or not Greece would be able to raise the funds necessary to pay their creditors. As a result, both European and U.S. stock markets rallied. This had the opposite effect on the U.S. bond market, traders sold positions in risk averse Treasuries in favor of buying stocks which pushed benchmark yields higher. Consequently mortgage rates moved up before the day even began. READ MORE
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