Euro comments, US data push treasury yields higher
Posted July 27, 2012
The recent rise in Treasury Yields began yesterday with comments from ECB President Mario Draghi. His commitment to the EU, and comment of “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro” provided some temporary confidence in the markets which helped to drive Treasury prices down and move yields higher, thereby putting upward pressure on US Mortgage Rates. Weekly jobless claims came in much lower as well on Thursday, helping to add momentum to the yield increase.
That trend continued Friday with the release of GDP data and Consumer Sentiment, both reports coming in slightly stronger than expected. Treasury Yields moved to 1.58 by mid-afternoon Friday, which is almost a twenty basis point move for the week. Mortgage Rates are the feeling the pressure and have inched up since the beginning of the week as well.
Here in the Triangle, Job pressures are being felt as well, with the Unemployment Rate moving from 7.8% in May to 8.2% in June according to the North Carolina State Division of Employment Security. This is certainly a trend we want to watch closely, as any additional increase would potentially jeopardize the continued healing of Triangle Housing fundamentals.
Have a wonderful weekend.