The 10-year T-note hovered near 4.35 percent this week, and mortgages have held their improvement to 6.125 percent, the best level since September. The predominant bond-market bet is still placed on a slowing economy, but until a slowdown actually appears in the data it's near impossible for long-term rates to do any better than they have. The Fed will on Feb. 1 hike another .25 percent to 4.5 percent, leaving the 10-year T-note badly exposed unless and until slowdown data appear. Long-term rates moved as low as they have over the holidays because the Fed has wigwagged a near end to its rate hikes, and because of the first, tentative signs of a slowing housing market. Just before Christmas, the November home sales data arrived weaker than a weak forecast: existing-home sales fell 1.7 percent (versus the negative 1.3 percent expected), and new homes were off 11.3 percent (versus minus 8 percent). Inventories of unsold homes rose to a 19-year high, but the time span overstates the actual...
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