Investor
Financial Update
As we enter 2007 the "experts" remain uncertain regarding potential interest cuts by the Fed - focus continues to be on inflation. Several market-makers are projecting no Fed movement until 3rd Quarter 2007; others project the Fed Funds Rate will be down some 100 basis points by year-end; still others predict no change until 1st Quarter 2008! The upcoming week will see the release of the Consumer Price Index (CPI - is inflation affecting our personal pocketbooks)- the good news here is that
the price of oil has seen substantial improvement over the past few months, down some $20 a barrel since summers' highs - as well as the Producers Price Index (PPI - are rising prices affecting the manufacturing and industrial sectors). These reports will be monitored by market makers as they anticipate potential Federal Open Market Committee's actions at their upcoming meeting Jan 30/31st.
Rates continued to creep up slightly this past week following the better-than-expected employment data released last week - the best results in three months. The fear is that stronger employment coupled with higher wages (potential increase in the minimum wage) puts upward pressure on inflation which can potentially translate into higher interest rates down the line. However, Frank Nothaft, Freddie Mac's Chief Economist, said he does not think rates will rise very far this year, with 30 year Fixed rates averaging 6.5%.
Rates for the weekend (thru Monday's holiday):
Conforming 30 Year - 6.125
Jumbo 30 Year - 6.250
30 Year/10 Yr I/O - 6.375
5/1 ARM /O - 6.125
10/1 ARM I/O 6.375
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Debra Y. Villarreal LLC, REALTOR® |
Weichert REALTORS® 4701 Old Dominion Dr. Arlington, VA 22207 Fax: 703-564-9852 |
