Good Monday AM, from your Hometown Lender,
Nothing on the calendar for today however this week does bring some important economic data.
The three things that are most likely to move rates this week are:
1) Inflation Nation: After several rounds of higher PCE, CPI and PPI data, we one last major report prior to next week’s FOMC meeting. And that report is none other than the Fed’s preferred measure of inflation, PCE and Core PCE. The PCE MOM data is expected to increase over last month’s data. The key for bond markets will be if the increase is higher or lower than expectations and the results could have a big impact on pricing.
2) GDP: We will get our first look at the 1st QTR GDP on Thursday. It is expected to come in the 2.5% range which is very important as long bonds react very negatively to GDP levels in the 2.5% to 3.00% range.
3) Central Bank Palooza: We get key interest rate decisions out of the world’s #2 and #3 economies with the People’s Bank of China and the Bank of Japan.
- Treasury Dump: We have a record setting week of dumping our debt into the marketplace, we will need to see what the appetite is for the large supply that will hit.
- 04/23 2 year note
- 04/24 5 year note
- 04/25 7 year note
I am not confident floating is a good idea this week.
The caveat to that is we are trading at the top of the trading channel. Keep in mind Next week brings the FOMC meeting.
Some great illustrations below that give a high-level overview of housing and rates. I feel encouraged.
Stay safe and make today great!
