6/8/10

Most rate prices improved slightly today as mortgage bonds continue to grind higher and tighter to Treasuries as the Dow falls below 9800. Growing concern of a double dip recession (in addition to all the other challenges we keep talking about!) is benefitting bonds as the flight to quality and low supply continue to provide some low rates. Economic releases today were limited to a couple of optimism reports, one showing improved small business outlook; the other indicating pessimism from the public (what a shocker!) On tap today is the first round of auctions this week with an offering of 3 year notes.