Daily Commentary by Larry Baer: Investors
are slowly drifting back to their desks after the first three-day weekend of
the summer. There is really no hurry -
all of the major economic news is back-loaded to the final two days of the
week.
Mortgage investors will be looking for clues
as to whether another interest rate friendly round of bond purchases from the
Fed may be in the cards before the summer is over. Thursday's 8:30 a.m. ET release of revised Q1
Gross Domestic Product figures together with Friday's May Nonfarm Payroll
report will be key pieces of evidence.
If, as expected, first-quarter economic growth as represented by GDP
posts a reading of 2.0% or more and May nonfarm payrolls hit 150,000 or so -
the hope for more interest rate friendly bond purchases from the Fed will fade
rather sharply. In my judgment it will
likely take a revised Q1 GDP number of 2.0% or less together with a May nonfarm
payroll number of 125,000 or less to support the prospects for yet lower
mortgage interest rates. While such an
outcome is certainly possible - at this juncture it does not appear to be very
probable.
THE
MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
