Monday’s Market Trends Recap (on Tuesday)by Tim Manni
This week’s issue of HSH’s Market Trends Newsletter, “Mortgage Rates Creep Downward,” examines how economic indicators like home sales, Gross Domestic Product, and Durable Goods orders have influenced the movement of mortgage rates:
Overall fixed mortgage rates shed another four basis points (.04%) this week, with HSH’s Fixed Rate Mortgage Indicator (FRMI) nudging down to 6.95%. Over the past four weeks and since the passing of the housing bill, the FRMI has wandered aimlessly in a 10-basis-point range. Hybrid 5/1 ARMs, which have put in wide swings in rates at times this summer, have also settled into a mellow pattern, unchanged this week at 6.63%.
Existing Home Sales flared 3.1% higher during July, climbing back to a 5 million annualized sales pace. The number of sales has traversed this level back and forth over the past ten months. Inventory continues to pour onto the market, and there’s more than 11 months of homes available at the present rate of sale.
The big number of the week was the final second-quarter figure for Gross Domestic Product, which rose at a 3.3% clip, revised upward from the initial estimate of 1.9% growth. The magnitude of the revision was a surprise, and no doubt was goosed by the influence of the one-time economic stimulus package, but that’s now behind us.
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!