Mortgae Bond prices Getting Hammered

Mortgage bond prices remain lower mid-morning erasing the small gains seen Tuesday afternoon. Rates are under pressure from strong stocks. In news released this morning, Q1 productivity fell 0.9%. That data was near expectations. Traders will spend the day watching stocks as they wait for the release of the Fed Beige Book set for 2:00 pm ET. Global stock markets were higher in overnight trade and buying spilled over to the US markets. At the 10:00 am ET price point the Dow was up 142-points. Central Banks: In overnight trade the European Central Bank (ECB) left its interest rates unchanged for the sixth straight month. Mario Draghi, president of the ECB, resisted calls for monetary easing preferring more political action instead. Given the recent raft of bad economic data coming out of Europe recently some were hoping the ECB would take action. Here in the US, the Federal Reserve is set to hold their policy meeting next week (June 19-20th). Just like Europe, the governing body is feeling the heat as the economy slows. The talk of QE3 has been on the table for a long time. Given the recent string of bad economic data, specifically the jobs report last Friday, the pressure is building on Mr. Bernanke to take further action.