Mortgage bond prices opened higher Tuesday morning adding to the gains seen Monday afternoon.
In
news released at the open, personal income rose 0.5% and outlays were
unchanged. Expectations were for income to rise 0.4% and outlays to
rise 0.1%. The inflation component of the report, core PCE, rose 0.2%
as expected.
Traders are now waiting for stocks to begin trade
at 9:30 am ET and for the release of consumer confidence data set for
10:00 am ET.
The Federal Reserve convenes a two-day meeting
today and will announce any changes to monetary policy tomorrow.
Thursday the ECB meets and Friday brings the monthly jobs report.
Traders’ expectations for action from the central banks are high,
especially for the ECB. While the Fed has the option of waiting until
September, when the governing body publishes new economic projections,
Mr. Draghi from the ECB does not have that luxury. With rising
unemployment and falling GDP, the ECB must do something to sooth the
markets. Europe desperately needs to buy some time.
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