Mortgage rates held relatively steady last week despite an increase of roughly 7 basis points on the 5 year and 10 year treasury notes. A majority of the rate market activity recently has been in treasuries with mortgage rates remaining surprisingly stable. The stock market remains confined to a wide trading range with many large investors still sitting it out while more data is released about the near term economic outlook. Many experts believe the economy will resist a double dip recession but remain very skeptical about an increase in economic activity.

Looking ahead, many economists believe that U.S. interest rates will remain low for an extended period of time. Words from Fed Chairman Bernanke last week seemed to reiterate that the economy continues to struggle particularly with jobs and a housing sector that remains in recession. After a strong week last week in the stock market and selling in the bond market, one focus will be treasury auctions. Strong demand continues for treasury bills with a total of $104B set to be sold Tuesday, Wednesday and Thursday this week. June new home sales are to be announced Monday and are expected to be up 4.25% from May. Other key data announcements this week include early estimates of 2nd quarter GDP and the Chicago Purchase Managers’ Index.

Greg Iverson
Mortgage Banker
Envoy Mortgage LP

10121 Paget Dr.
St. Louis, MO 63132

314-993-6690 Office
877-907-6907 Toll Free
636-751-1068 Cell
866-560-1801 Fax