25 September 2009 ? Today the bond market opened up 3bps and continued to improve and is currently at 15bps. Durable Goods Orders for August unexpectedly fell 2.4% for the largest decline since January. This was a big miss from projections, as mentioned in previous updates, the increase in orders may have been inventories falling to all time lows and it was a one-time replenishing. We will continue to pay close attention to this number going forward. With a weak labor market and anemic wage growth, consumers are not making a lot of Durable Goods purchases. Durable Goods are big ticket purchases meant to last more than three years, for example, flat screen TV?s, furniture and appliances. Until we see the labor market improve we are not likely to see improvement in Durable Goods Orders.
Consumer Sentiment was reported at 73.5 better than expectations of 70.5. This improvement is probably a direct result of the huge rise in the stock market. On another note, new home sales were reported at 429,000, which is slightly lower than expectations of 441,000. The inventory of unsold homes dropped slightly to 7.3% however I have stated before that the banks are holding onto foreclosures and we may see a whole new slew of sales coming onto the market.
The 30 year rate is at 4.875% (apr 4.909) and the 15 year rate is at 4.375% (apr 4.433).Email This Post To a Friend.