Fannie’s Big Student Loan Changes; at 2 Week Highs; New Home Sales Surge; Prices Not Cooling
Mortgage rates moved moderately higher again higher today, as global financial markets continued reacting to recent geopolitical flashpoints (like the French election, discussed yesterday). Markets are also moving in anticipation of future flashpoints (like tomorrow's tax reform announcement). In general, investors have piled back into riskier assets like stocks because the French election reduces long-term risks to the European Union. Investors previously were more willing to buy bonds--a safe haven asset frequently used to insulate investors from increased risk. The prospects for tax reform have a similar effect in that they encourage investors to favor riskier assets at the expense of bonds . When demand for bonds decreases relative to supply, rates move higher . To be clear, we can't have
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