Contrary to what we thought, Consumer Confidence was lower than expected this morning. We were right when we said someone would be surprised. The expectations were very tight at 104.9 to 105.0. The Conference Board reported Consumer Confidence at 104.0.

What probably impacted rates to a greater extent was Existing Home Sales which were anticipated to be 6.40M to 6.69M unit.  That was lower than last months number. In March 6.12M Existing Homes were sold.

The two combined to bring rates down. The 10-year Treasury is -.036 at 4.614%.

There were weekly items of lesser importance, but can give clues to upcoming Retail Sales number. UBS Store Sales was -0.3% in week-to-week comparison, and +2.1% in year-to-year analysis. Redbook was -0.2% in year-to-year comparison.

TOMORROW, 25 April 2007

There are two important and market moving items in the morning.

Wednesday’s bond market opens with Durable Goods Orders. There is a wide range of expectations from +1.2% to +3.0%. Of the sources we follow, only one is at the +1.2% level. The remaining estimates range from +2.2 to +3.0. The lowest one at +1.2% does tend to be the correct one when its estimates are far outside of the common estimates. With the exception of the +1.2%, all are above last month’s +1.7%. This MAY give us a good day.

Like today’s Existing Home Sales, New Home Sales are forecast to be above the 848k units sold last month. The bond market is looking for New Home Sales to be 885k to 900k units.

Be careful not to assume New Home Sales will copy today’s Existing Home Sales trend of coming in below predictions. It is seldom that the two move in the same direction. New Home Sales has recently been below forecast.

There are two more items that occasionally move rates, but not often. The market will open with the weekly Mortgage Bankers Association (MBA) Purchase Application Index. The FED’s Beige Book is published at 13:00cdt {1:00p.m, 18:00gmt}. MBA Index and the Beige Book have no predictions.

[Publisher’s note: In an attempt to clean up our blog, we will post all three outlooks on Monday only. We will post an outlook on days when one is modified.]

Steve Boxmeyer [612] 799 – 6858
steve@LendWithIntegrity.com