What Are Interest Rates Going To Do? 4/28/08

You like me, are asked this question every day. "What Do You Think Interest Rates Are Going To Do?" Now here is a customer focused report for Mortgage Market Direction:Week of:

Week of: Monday, April 28, 2008

Presently Market Conditions Are:
U.S. stocks posted the first back-to-back weekly gains since February after earnings at Boeing Co. and Philip Morris International Inc. bolstered speculation that overseas growth will offset slower domestic demand. With stocks climbing, U.S. Treasury prices continued to decline and investors are now waging strong bets that the Federal Reserve will indicate this week it plans to end its campaign of interest rate cuts.

My Expectations Are:
The central bank is widely expected to cut rates by a quarter percentage point at its policy meeting on Wednesday. A growing number of economists predict the Fed will then keep rates on hold to ward off inflation. “What it means is that the market isn’t so convinced that the economy is falling apart as it was a month ago,” said David Wyss, chief economist at Standard and Poor’s. “It also means that investors are not expecting the Fed to go down as far--25 basis points instead of 50.”

As Your Trusted Advisor For Life, My Guidance For You Is:
Mortgage rates have an inverse relationship with bond prices. As bond prices continue to fall, it is likely to see an increase in mortgage interest rates. With current mortgage rates still at historically low levels, now is the time to contact your mortgage professional so they can structure a mortgage solution to meet your financial goals.