Sep 082014
 

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By G. Steven Bray

Mortgage rates remain stuck, which is a good thing when rates are this low. However, with last Fri’s sorry US jobs report, some are wondering why rates didn’t move lower. The simplest reason seems to be that markets didn’t believe the report. The report showed almost 100k fewer jobs created in Aug than was expected while most other economic indicators (except housing) are showing moderate growth.

Another reason may be Europe. We’ve talked at length the last few weeks how ultra-low European bond rates are pressuring US rates. The European Central Bank did little last week to alter the rate picture. It hinted at a quantitative easing program to lift European economies but provided little detail. Then, it seemed to backtrack. The result was some rate market volatility but ultimately little change.

This week’s most significant economic report is retail sales on Fri. Until then (and quite possibly beyond), I look for rates to react to any global headlines (such as from Ukraine or Syria) but otherwise remain stuck.

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