August 28th, 2023 4:42 PM by Richard Sardella MLO.100007700/NMLS 233568
No data today but two Treasury auctions, at 11:30 am $45B of 2 year notes; at 1 pm $46B of 5 year notes. This week’s key data is on Thursday and Friday; August PCE on Thursday, August employment on Friday.
The speech by J Powell on Friday resonating as economists and traders digest his short comments (15 minutes). The outlook for more rate increases has changed somewhat, maybe the Fed is finished increasing rates this year. The Sept FOMC meeting now expected to be with no increase, that was already thought to be the case; the final meeting this year comes in November. Powell set a high bar for additional interest-rate hikes, economists said Sunday in their commentary at the U.S. central bank’s summer retreat in Jackson Hole. Powell stressed the Fed would “proceed carefully” and balance the risks of tightening too much or too little. Has the done enough, has it over tightened? As usual what the fed will do is dependent on incoming data and Powell stressed that in his comments.
Boston Fed pres. Susan Collins: “I would say I am somewhere in the middle,”… “Are there scenarios,” she asked, “where we hold pretty close to where we are now? Yes, there are.”… “I know it’s frustrating, Many people would like to see a clear, preset path.” “From my perspective, the most important thing right now is patience and looking really holistically at patterns of data — not overreacting to, for example, the most recent retail sales.”
At 9:30 am the DJIA opened +168, NASDAQ +97, S%P +22. 10 year at 9:30 am 4.21% -2 bps. FNMA 6.0 30 year coupon at 9:30 am +19 bps from Friday’s close and +23 bps from 9:30 am Friday.
At 11:30 am 2 year note auction
At 1 pm 5 year note auction
This is employment week, Friday August employment data.
PRICES @ 10:00 AM
10 year note: 4.22% - 1 bp
5 year note: 4.42% -3 bp
2 year note: 5.06% -2 bp
30 year bond: 4.28% -1 bp
30 year FNMA 6.0: @9:30 am 99.71 +19 bp (+23 bp from 9:30 am Friday)
30 year FNMA 5.5: @9:30 am 98.07 +17 bp (+24 bp from 9:30 am Friday)
30 year GNMA 5.5: @9:30 am 98.27 +17 bp (+14 bp from 9:30 am Friday)
Dollar/Yuan: $7.2926 +$0.0029
Dollar/Yen: 146.56 +0.12 yen
Dollar/Euro: $1.0808 +$0.0012
Dollar Index: 104.12 +0.04
Gold: $1944.40 +$4.50
Bitcoin: 26,109 +25
Crude Oil: $80.62 +$0.79
DJIA: 34,611 +265
NASDAQ: 13,665 +75
S&P 500: 4431 +25
Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.
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MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.