Irish bonds are bouncing for a 2nd day as a decision has not yet been made by Irish officials of whether to tap the EFSF for financing. Because Ireland’s government doesn’t need funding until the middle of ’11, any use of the facility will be used to further recapitalize Ireland’s busted banks. Greek debt is trading lower as their budget deficit #’s were revised higher. As highlighted by the WSJ’s front page, another round of Fed criticism is testing the credibility and reputation of the institution and US Treasury yields continue higher. The 30 yr bond yield, most sensitive to inflation expectations, is at a fresh 6 month high, the 10 yr is at a 14 week high and the 2 yr is rising to a 2 month high. For the potential home buyer and refinancer, the average 30 yr mortgage rate on Friday rose to 4.43% according to Bankrate.com, the highest in 6 weeks.
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