The bond market anticipates future inflation, and demand today for longer term bonds (10 - 30 year) was much less than anticipated.
The result? Interest rates, after falling to historic lows this past three weeks, are headed back up.
- If you're a REALTOR, light a fire under your buyers.
- If you're a buyer, it's time to jump in.
The only thing that I can see pushing bond yields back up (and interest rates down) would be the government stepping in and purchasing bonds.
Don't count on it.
photo courtesy Spaceball on Flickr