Another week, another chance for markets to express their feelings about European QE, Greek theater, and 'global growth concerns.'  So far, these things have been nothing but great for domestic interest rates--particularly the longer maturities.  This is also compounded by fear that the Fed is on some ideological mission to hike rates simply to stick to its own script, and because domestic economic data has been defiantly decent compared to the rest of the world. 

Consequently, the next time someone suggests that this year's potential Fed rate hike could hurt mortgage rates, kindly inform them that rates have plummeted to long-term lows all throughout the time when rate-hike expectations have been increasing.  You could also add that low rates are being fueled by a lack of inflation and global growth concerns, which would logically mean a Fed rate hike would probably be a net-positive for mortgage rates.

As the Fed let us know last week, they have an eye on Global developments in addition to the domestic economy, and there will be plenty to watch this week.  The domestic calendar has a top tier report on 4 out of 5 mornings, culminating in NFP Friday.  Internationally, most European countries will have PMI readings (Purchasing Managers' Index), which are always potential market movers.  There will be PMI readings at home as well, with ISM Manufacturing kicking off the top-tier data parade at 10am today.

In addition to developments in Europe and economic data, bonds may also have an eye on stocks (and vice versa) as stocks have been in a big consolidation pattern into the new year.  A big bounce back toward the top of the pattern or a noticeable break below would certainly be worthy of bond market attention, if for no other reason than investors reallocating between stocks and bonds if one of them has a big move.

2015-2-1 lever

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
103-15 : +0-00
FNMA 3.5
105-22 : +0-00
FNMA 4.0
107-04 : +0-00
2 YR
0.4720 : +0.0193
10 YR
1.6740 : +0.0350
30 YR
2.2540 : +0.0311
Pricing as of 2/2/15 7:22AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Monday, Feb 02
8:30 Personal consump real mm (%)* Dec 0.7
8:30 Personal income mm (%) Dec 0.2 0.4
10:00 Construction spending (%)* Dec 0.7 -0.3
10:00 ISM Manufacturing PMI * Jan 54.5 55.1
Tuesday, Feb 03
9:45 ISM-New York index * Jan 673.8
10:00 Factory orders mm (%) Dec -2.2 -0.7
Wednesday, Feb 04
7:00 Mortgage Market Index w/e 544.2
8:15 ADP National Employment (k)* Jan 225 241
10:00 ISM N-Mfg PMI * Jan 56.3 56.5
Thursday, Feb 05
8:30 International trade mm $ (bl)* Dec -38.0 -39.0
8:30 Initial Jobless Claims (k)* w/e 290 265
Friday, Feb 06
8:30 Non-farm payrolls (k)* Jan 234 252
8:30 Unemployment rate mm (%)* Jan 5.6 5.6
15:00 Consumer credit (bl) Dec 15.00 14.08