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August 19th, 2008

Monday’s Market Trends Recap (on Tuesday)



This week’s issue of HSH’s Market Trends Newsletter, “Mortgage Rates Hold Steady,” examines how recent economic conditions like the prolonged credit crunch and inflation have affected the movement of mortgage rates:

August 15, 2008 — Home mortgage rates were well-behaved this week as economic news proved a mixed bag, but perhaps the markets focused more on the Olympics than on the data that came out.

Whatever other news may bring, loan officers believe that the credit crunch shows no sign of letting up. According to the latest Senior Loan Officer Opinion Survey, fully 75% of the banks, both large and small, surveyed by the Federal Reserve reported further tightening of lending standards for ‘prime’ mortgage loans. Even credit cards are more difficult to get.

HSH’s Fixed Rate Mortgage Indicator (FRMI) found that the average interest rate for all 30-year FRMs — including conforming, jumbo and expanded conforming offerings — slipped to 7.02% this week…

This issue also discusses how economic indicators like the trade deficit, import and export costs, consumer pricing, and industrial production have meshed with the current state of the market:

The US trade deficit narrowed in June, defying forecasts, as goods exported rose by a stout 4% while imports increased by only 1.8% due to lessened demand here.

High energy costs continue to be a drag on the economy; prices rose 4% last month versus 6.6% in June. The measure of ‘core’ CPI, which excludes food and energy, remained at June’s 0.3% level. Inflation has been jumpy on a month-to-month basis, but should begin to slow as (and if) gas prices keep declining.

HSH’s free, weekly Market Trends Newsletter, an in-depth analysis of various financial markets of the week prior, is published every Monday. Email subscribers — receive it in your inbox by Friday night, so sign up today!

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

Our bloggers:

Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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