Home Prices advanced another 6.7% over the last 12 months, according to a report out by CoreLogic this morning. A third of the surge is driven by a 2.1% increase in prices between February and March of this year alone. But home prices seem to be a standout in an otherwise bleak financial landscape.
The Reserve Bank of Australia cut its benchmark interest rate to an all-time low this morning. We don’t talk about Australia very often, not because they are down around 12 in GDP output, but because their economy seems to be relatively even-keeled compared with the rest of the developed world. And that doesn’t make the news. Australia’s cost of funds rate is still almost 5X the U.S.’ at 1.75%. Ours hasn’t been that high since July of 2010. Weak economic data out of China and stagnated growth in Europe are also boosting domestic mortgage bonds this morning, whose prices have now shrugged off the down weeks since tax day and are in an upward channel–meaning that there is less pressure for interest rates to go up.