Interest Rates drop to two month lows

Interest rates for buying a home on the Palos Verdes Peninsula dipped again this week to their lowest levels in about two and a half months.The following are excerpts from the newsletter on interest rates published by HSH Associates :

“The drumbeat of economic data has become more muted and flat over the last month or so. The latest batch out this week featured several important reports that revealed a more stumbling than steady gait for the economy, contrary to an expected quickening of pace.

Concern about these changes and the Fed’s still-firm commitment to steadily remove QE supports this year has spooked investors here and abroad. We have seen a significant downturn in equity prices since the calendar turned and a flight-to-safety buy of US Treasuries amid more signals that the global economy lacks traction, while inflation remains muted and of little concern for the foreseeable future. In this kind of environment, and with so many challenges evident, it is very difficult for interest rates to firm, but absent true calamity, there are limits on how far they can fall.

Without a domestic economy putting up better numbers, and with plenty of concerns about global growth, mortgage rates have eased now for five straight weeks. The decline now totals about a quarter of a percentage point or so from where we began 2014, enough to trim the top off the 2013 rise and to take us back to November levels. Although a considerable drop, it’s probably not enough to change the fortunes of homebuyers or refinancers, but is welcome, nonetheless.
Even with plenty of economic difficulties in view, stock markets have found some footing of late, and interest rates have stopped declining for the most part. With investors moving funds to riskier propositions, underlying interest rates which influence mortgages not only stopped declining but have nudged higher over the last few days. Based on that, it would seem that the nice little fall in mortgage rates is coming to an end, at least for now. We expect a little firming for rates next week, when a less crowded calendar of reports will provide clues about retail sales, industrial production, and consumer sentiment. At the moment, we expect a rise of 3-5 basis points or thereabouts. ”
– See more at: http://activerain.com/blogsview/4322983/interest-rates-drop-to-two-month-lows#sthash.f9DLGAB6.dpuf

About mmegowan

I am a realtor with Remax Estate Properties in Palos Verdes Estates. Visit my website at http://www.maureenmegowan.com
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s