Markets & Mortgage Rates
Stocks are up, while Mortgage Bonds are lower to start the week. Bonds have been on a strong rally, rising for eight straight days and breaking key resistance levels. Over the past month and a half, 30-year fixed mortgage rates have dropped by about 0.5%, offering some relief for borrowers.
Treasury Secretary’s Take on Housing & Economy
Treasury Secretary Scott Bessent shared an optimistic outlook, expecting:
- Inflation hit the 2% target, thanks to oil policies and deficit reduction.
- The 10-year Treasury yield to move lower, helping mortgage rates improve.
- A housing market thaws in the coming weeks, which would boost activity.
- Continued GDP growth, despite recent concerning data.
GDP & Recession Risks
The Atlanta Fed drastically cut its Q1 2025 GDP estimate from 2.9% to -1.5% over the past few weeks, signaling potential economic slowdown. Consumer spending also declined (-0.2%), adding to concerns. If this trend continues, the Fed may have to reconsider its stance on rate cuts, which could further benefit mortgage rates.
Crypto Strategic Reserve
President Trump announced an executive order on digital assets, directing the formation of a Crypto Strategic Reserve that includes XRP, Solana, Cardano, Bitcoin, Ethereum, and other major cryptocurrencies. This move could have significant long-term implications for digital assets and the economy.
Housing Market & Home Prices
Realtor.com reported that days on market dropped 10% in February, signaling increased demand as we enter the spring homebuying season.
ICE data showed home prices rose slightly (+0.1%) in January, indicating stability despite higher rates.
Key Reports This Week
- Wednesday: Mortgage Apps, ADP Jobs Report, Fed’s Beige Book
- Thursday: Jobless Claims, Jobs Data Preview
- Friday: BLS Jobs Report (Biggest Market Mover!)
The jobs report will be crucial, with estimates of 140,000–150,000 new jobs and unemployment holding at 4%. Weak data could further support rate cuts.
Technical Analysis: Mortgage Bonds & 10-Year Treasury
- Mortgage Bonds: Still in an uptrend but facing resistance at 101.55 with support at 101.39.
- 10-Year Treasury Yield: Testing its 200-day Moving Average—if it holds below, rates could improve further.
Strategy
Continue floating for now but watch key levels closely.
Bottom Line
Rates are improving, the housing market is showing early signs of life, and economic data could shape Fed policy in the coming weeks. Stay tuned!
