Mortgage rates began the week with a modest move back up and over the 7% threshold, but managed to erase some of those losses Tuesday.
The improvement followed Tuesday's Retail Sales data which came out weaker than expected.
Mortgage rates are based on trading levels in the bond market.
Bonds pay attention to multiple cues at any given time.
Retail Sales isn't as big of a report as the Consumer Price Index (CPI) or The Employment Situation (the jobs report), but it's a respectable supporting act.
Sales growth was surprisingly high in the data that came out in March and April. May's report showed a correction back to 0.0% growth.
Tuesday's report came in just barely positive at 0.1--a far cry from the 0.6 level 2 months ago and below the median forecast of 0.2.
In addition, it included a revision to May's report from 0.0 to -0.2. All told, it painted a less upbeat picture for the American consumer compared to a few months ago.
A slower economy is less able to sustain higher interest rates for a variety of reasons--not the least of which being the suggestion of slower price growth.
With that, bond traders bought more bonds, thus pushing bond prices higher and yields (aka "rates") lower.
That's it for today!
Thanks for reading!
Brett
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