This week’s economic calendar is lighter than the previous week’s with the main reports being Retail Sales, confidence and the weekly jobless claims.
The U.S. Treasury will be auctioning $66 billion in debt; 3-year notes (Tuesday), 10-year notes (Wednesday), and 30-year bonds (Thursday).
Oil is on fire, literally and figuratively. WTI (West Texas) crude, the primary determinant of gas prices in the U.S., is currently trading $2 higher at $106.50 per barrel. The longer oil prices remain elevated, the more damage this does to economic growth. If this spike in prices is temporary the drag on the economy will be muted, but prices go much higher and remain there, economic forecasts will be revised lower very quickly. Bill Daley, the President’s new Chief of Staff, said this weekend that the President is considering tapping the strategic oil reserves to alleviate the rising prices.
Treasuries are giving back some of last week’s gains with the yield on the 10 year note rising from Friday’s close of 3.48% to 3.505%. Mortgage prices are worse by a few basis points.
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