Treasuriesrallied across the curve this morning as tensions between U.S. and North Korea intensified overnight.? The UST10-Year yield is currently at 2.221% after closing at 2.263% prior.
Risk aversion rippled through global markets overnight as geopolitical tensions between U.S. and North Korea mounted, forcing investors to flee to safe-haven assets. North Korea issued a statement as a response to President Trump's warning of a “fire and fury” attack on North Korea stating that it was carefully examining a plan to attack U.S. military bases in Guam. As a result, global stocks moved lower while safe haven assets and currencies rallied.
Today's economic calendar kicked off with the MBA Mortgage Applications for the week ending on August 4th, which increased in activity by 3.00% after falling 2.80% the prior week. Purchase applications rose 0.80% after falling 2.00% the prior week, and refinancing applications jumped 5.30% after falling 3.80% the prior week. Nonfarm Productivity rebounded in 2Q as expected, improving from 0.10% 1Q (revised) to 0.90% in 2Q. Unit Labor Costs rose just 0.60% in 2Q after rising 5.40% in 1Q (revised) as a result from an increase in productivity. Wholesale InventoriesMoM rose 0.70% in June versus a 0.60% increase prior; consensus called for another 0.60% increase, so the data came in slightly above expectations.
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Risk aversion rippled through global markets overnight as geopolitical tensions between U.S. and North Korea mounted, forcing investors to flee to safe-haven assets. North Korea issued a statement as a response to President Trump's warning of a “fire and fury” attack on North Korea stating that it was carefully examining a plan to attack U.S. military bases in Guam. As a result, global stocks moved lower while safe haven assets and currencies rallied.
Today's economic calendar kicked off with the MBA Mortgage Applications for the week ending on August 4th, which increased in activity by 3.00% after falling 2.80% the prior week. Purchase applications rose 0.80% after falling 2.00% the prior week, and refinancing applications jumped 5.30% after falling 3.80% the prior week. Nonfarm Productivity rebounded in 2Q as expected, improving from 0.10% 1Q (revised) to 0.90% in 2Q. Unit Labor Costs rose just 0.60% in 2Q after rising 5.40% in 1Q (revised) as a result from an increase in productivity. Wholesale Inventories MoM rose 0.70% in June versus a 0.60% increase prior; consensus called for another 0.60% increase, so the data came in slightly above expectations.
The curve has bull-flattened with the UST 10-Year down 4.2 bps from prior closing.