Placed in Market Update
The rates keep dropping. The overall average rate for 30-year fixed-rate mortgages decreased by five basis points (.05%) to a new record low of 3.91%, for the week ending July 13. The 15-year fixed-rate also declined by five basis points, to an average 3.20%. FHA-backed 30-year mortgages had a major decrease of six points (.06%), sliding to 3.52%. The overall average rate for 5/1 Hybrid ARMs also reached a new record low at 2.86%, a dip of two basis points.
Recently released minutes of the Federal Reserve’s June meeting indicate that policymakers believe that unemployment will remain high for the next five years, although most don’t consider that enough reason for them to initiate other actions to stimulate growth. The report noted that while some members felt that additional steps such as bond purchases “likely would be necessary to promote satisfactory growth,” others thought that their intervention would be warranted if the economy was in greater trouble. Meanwhile, it seems that Americans have become even more vocal about their displeasure with the economy. This month’s Thomson Reuters/University of Michigan index of consumer sentiment slumped to the lowest level so far this year: 72 compared to 73.2 in June.
Next week: highlights of Fed Chairman Ben Bernanke’s economic analysis presented to Congress.