Lower Rates Ahead?
By Week end, we see the 10- Year Treasury drop beneath 2.40% to 2.38%, and Mortgage Bonds trading in a range of 102.62 and 102.83. If the bonds continue to increase and break the barrier of resistance, we will see rates decrease in the not so far future.
Another indication that lower rates are ahead come from looking at international markets. The German 10-year Bond, equivalent to our 10-year treasury is currently trading at 1% , and the DAX (German Stock Market) has broken down as of late. This could also indicate the US Stock market will move lower within the next couple of months.
Mortgage Applications slowed last week, with applications down nearly 3%, and the Mortgage Bankers association also shows that refinances have dropped nearly 4%. Purchases are down about 10% from this time last year.