Monday, June 09, 2008

What Are Interest Rates Going To Do? 6/09/08

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: Monday, June 09, 2008

Presently Market Conditions Are:
Stocks gave back their gains from the week before and the short-lived boost in the U.S. dollar following Bernanke's comments also retreated to previous levels. The unemployment rate jumped to 5.5%, it's highest since 2004, however this tends to hold or reduce interest rates; a good sign for the mortgage industry. Fannie Mae's president and CEO, Daniel Mudd commenting on the most sever housing slump since the Great Depression, said that we are "Likely to be about halfway through right now." Fed Governor Randall Kroszner recently said the U.S. housing sector will gradually recover as an excess of home inventory is reduced. Fed Governors differ as to when the Fed should start tightening to stave off inflationary concerns, but agree it will likely not be until the end of the 2008.

My Expectations Are:
Mortgage rates are expected to continue to bounce up and down but fortunately within a tight range. Most all eyes will be on two primary economic reports due for release this week. Retail Sales, released by the Department of Commerce, is due out Thursday and the Consumer Price Index (CPI), released by the Department of Labor, is due out this coming Friday. Both are expected to have approximately a .5% increase. If the actual numbers are lower, rates will likely follow with a slight decrease; the opposite being true as well.

As Your Trusted Advisor For Life, My Guidance For You Is:
Despite the volatility, rates continue to be at record lows. With growing speculation of inflation and potential interest rate increases be sure to leverage the knowledge and experience of a trusted mortgage professional to assist you in structuring a mortgage solution to meet your clients financial goals.

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