Interest rate are dropping big time the last three days.
There are three obvious reasons:
1) Very weak GDP report last Friday, with an especially weak revision. For Q2-2011, GDP grew at an annual rate of 1.3%, and Q1-2011 GDP was revised down to 0.4% GDP growth. Link
2) A weaker ISM Manufacturing report on Monday. "The PMI registered a 50.9%, a decrease of 4.4 percentage points..." link ; followed by a tepid ISM non-manufacturing report today, link
3) Italy taking center stage in the ECB/EU slow motion trainwreck, with Prime Minister Berlusconi poised to put gasoline on the fire later today in a nationwide speech. link
There is a major forth item that is looming in the background: some form of QE3. If history is any guide and we see additional Quantitative Easing, we will see interest rates move higher.
The interest rate conditions right now look very attractive to lock in interest rates at these levels.
Current Interest Rates
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