Weak economic data this morning are crushing stocks and creating a nice rally in bonds. The yield on U.S. Treasuries is lower across the curve, with the 10 year note falling to 2.975%! Mortgage prices have improved by .375% to .50% from the close on Tuesday.
ADP surprised the markets by reporting only 38,000 new jobs were created in May, well below the expectation of 175,000. The ADP report does not always track the Labor Department's data, which we will see Friday morning, however, it is an ominous sign given the weak data reports of the past few weeks.
In addition to ADP the Institute for Supply Management's business activity index for May came in at 53.5 versus the April reading of 60.4. While a number above 50 indicates continuing expansion in the manufacturing sector, momentum has definitely slowed.
The decrease in interest rates in giving home buyers and existing home owners another great opportunity to lock in a 30 year fixed rate at 4.5% or lower. Now is the time to take advantage of low interes rates in conjunction with the new, expanded guideline, product offerings from Home Savings! Contact your HSOA Community Banker for all of the details!
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