SubscribeDaily Futures Commentary April 29, 2009
Wednesday, April 29, 2009
Treasuries are trading flat to lower this morning as traders await the FOMC meeting decision. While traders are waiting for this report there is a 7-year Note auction taking place, U.S. economic reports and growing concerns about the outbreak of Swine Flu in the U.S.
The Fed is expected to keep interest rates at between 0 – .25% while acknowledging the continual slow down in the U.S. economy. There is also the possibility of more action to boost the Fed’s balance sheet. This would include additional purchases of Treasury instruments and mortgages.
Mortgage applications dropped last week. Traders had little reaction which could indicate that it is a seasonal move rather than a trend. The concern being it becomes a trend and housing demand continues to drop.
U.S. GDP is expected to show a contraction of 4.7%. This has already been priced into the markets. Any substantial deviation will move the markets, but if it is in line, expect no reaction as this is basically old news.
More negative news was released overnight regarding the preliminary bank stress tests. It has now …
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