Last week’s “shocker” jobs report of 38,000 added (vs. expectations of 160,000) was the worst since 2010. Treasury yields plunged immediately on Friday and stayed low as Fed Chair Yellen’s remarks on Monday took a June rate increase off the table, preferring to wait out the big “Brexit” vote and another jobs report. Unless the next jobs report is super-strong, look for the Fed to wait for September. Credit Spreads: Perm loan spreads (CMBS and Life Co) continue to tighten, with new 10 year loans pricing in the 4.25%-4.50% range. But CMBS lenders are “shrinking the box” (lower proceeds) as they deal with stricter rating agency standards and upcoming regulatory issues regarding risk retention. stay tuned.
