How do we interpret today’s NFP?  

Do we get excited about the headline or remain skeptical over the negative revisions. Personally I see the avalanche of data from the past week as bond friendly in the aggregate.  Mostly misses and the Fed was not hawkish.  I concede the ISM services and labor cost numbers stand out a bit, but today’s big revision to March wages should take the edge off the former and weak GDP and slow retail sales do similarly for the latter. Not to mention, a Puerto Rico BK doesn’t exactly give me warm and fuzzies either.  I don’t want to overstate the significance of that, but if nothing else, it’s the first time a US State or territory has taken those drastic financial steps.

So I guess the rate question is:  Oh my, are we sinking?   The bottom line is my float/lock assumptions remain intact.  There’s still plenty of time left on the day, but my sense is we’ll end it slightly positive.  I would further argue that we need to break 2.32 fairly early next week to back into that lower range mode.  

I don’t always celebrate cinco de mayo, but when I do it’s with lower rates.  Stay originating my friends.  

#Sink-oDeMy-o #HomeOnTheRange #LowerForLonger #StayOriginatingMyFriend