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RATES INCREASE DESPITE FALL IN TREASURY YIELDS

 
Mortgage interest rates increased slightly this past week despite the yield on the US Treasury 10 year note falling from 3.71% to 3.174% currently. This is the biggest weekly drop in the 10 year note since the stock market crash of 1987. Money continues to flow into safe Treasury debt with short-term yields nearing zero and out of the stock market. The Dow Jones Industrial Average is currently at 7,528, down almost 1,000 points on the week. The market is now speculating that the Fed may cut the Fed Funds rate by 75 basis points at its December FOMC meeting.
 
Economic data of note included the Producer Price Index (PPI) and the Consumer Price Index (CPI). PPI fell 2.8%, its largest decline since 1947 and CPI fell 1.0%, its largest decline in 61 years. October Housing Starts and Building Permits fell substantially. Housing Starts are at their lowest level since 1959 and Building Permits are at their lowest level since 1960.
 
Crude Oil futures prices continued to fall, dropping over $8 per barrel to $48.59 per barrel currently. Fannie Mae and Freddie Mac announced that they will suspend foreclosures over the holidays. Citigroup announced that they will eliminate over 50,000 jobs.
 
Next week look toward Tuesdays second look at third quarter GDP and Wednesdays Durable Goods Orders and Personal Income and Outlays as potential market moving events.

Tags: Tags: boulder, colorado, mortgage update, rates, real estate

This entry was posted on Tuesday, November 25th, 2008 at 12:03 pm and is filed under Buyer's Corner, First Time Buyers, Market Conditions, Relocating, Selling Thoughts, Trends. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

1. bad credit mortgage said at February 2nd, 2009 at 9:24 am

   bad credit mortgage…

   It used to be that when you bought a home and didn’ t have a twenty percent down payment lying around, you had to pay what is known as private mortgage insurance (PMI). PMI is insurance that the lenders requires borrowers to pay to insure that the lend…

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