The 30 year fixed rate is at 6.375% today before adjustments, if any. Yes……….rates are going up.
Mortgage/Economy news:
Oil has leaked into most economic data, and the trade gap was severely affected in April. It rose from a revised lower $56.5 billion to $60.9 billion. It was the highest since March of 2007. The U.S.’s oil bill hit a record high in April, and as oil has continued rising in May and June, the deficit may very well keep pushing higher.
The trade gap highlights a part of the reason that the futures markets are pricing in a rate hike by the end of this year. Fed Chairman Ben Bernanke and Boston Fed President Rosengren have both made comments in the past two days about protecting against inflation. The Fed’s primary weapon against inflation is to raise their overnight lending rate.
Unfortunately, the other expected effect of hiking rates is a slowdown in the economy, which we can ill afford at the moment. This is why most people believe the Fed will take a break from rate modifications for the next few months. That will give them a chance to step back and see what their recent policy decisions are really doing, if anything, to help the economy get back in gear.
Thought of the day:
It’s choice – not chance – that determines your destiny.
Jean Nidetch
(Provided by Steve Hale~Georgia Platinum Mortgage)
