Today, interest rates continue to increase with the 10 yr. at 1.86% in early trading (an increase of 22 bps. since last Friday).  The speed of the increase with continued selling suggests that long term treasuries are not likely  to get back to last weeks levels any time in the near future.

The rapid increase and little attempt to capitalize on the higher rates suggests that we may have hit the end of the rate decline cycle.  Investors, large banks and fund managers are expecting improvements to the economy in May.

The Fed's easements continue to fail to meet objectives, leading to a growing view that the Fed may begin winding down its stimulus moves.  This may not occur until the end of the year, but markets are already reacting to the possibility.

The US annual budget deficit for 2013 fell and the Treasury will have income to cover any debt ceiling concerns through September, which is the last month of the fiscal year.

Bernanke is scheduled to give a short speech today and we ill update you of any major announcements.

At this time we suggest locking loans that are scheduled to close in the near future.

- Michael Corboy