HomeLoans Blog

Middle East concerns are still impacting both the stock and bond markets. Coming off the three day weekend, the mortgage bond market had a "gap up," meaning that there was a sizeable improvement from Friday to Tuesday.

Today that improvement seems to be holding up, maybe with a slight improvement.

This improvement is continuing a trend that began several days ago.

The real question for me is if the bond market is ready for a significant rally that will drive rates back down to December levels, or if the Libya unrest is just giving mortgage bonds a temporary boost.

We will know more as the week progresses, and we hear if the economic data support the continuing mortgage bond improvements. We have a couple important reports out Thursday and Friday.

Many analysts seem to think that the recent stock rally is running out of steam, and it is time for bonds to have a run. This would bring about an improvement in mortgage rates.

I am just a little cautious about expecting any significant rate improvement. But again we will know more by Friday.