Mortgage Market Update

Fed Chair Janet Yellen will face her first test in her semi-annual monetary policy testimony in front of Congress this week. Ms. Yellen will be in front of the House Financial Services Committee on Tuesday and the Senate Banking Committee on Thursday. Ms. Yellen will be grilled a bit by those critical of the Fed’s actions to see what her take is on tapering QE3 and overall accommodative monetary policy.

The trading week begins with Stock prices modestly lower, while Bond prices are pushing higher. The week features just a few economic reports on Weekly Initial Jobless Claims, Retail Sales and Consumer Sentiment. Stocks have been under pressure in 2014 due to weaker than expected economic data, profit taking by investors, and the Fed easing back on its massive stimulus program, which is geared towards promoting both job and economic growth.

Fast food giant McDonald’s reported today that sales in January fell by 3.3% in the U.S., while total global sales were up 1.2%. The company cited bad weather last month for the decline in domestic sales. McDonald’s has been promoting its Dollar Menu, but has been also fending off competition by Wendy’s and Burger King.