Bryan Flynn's Central Massachusetts Mortgage Blog

head_left_image

Rates Worsen....Retail Sales in....better than expected.

Retail sales numbers were released this morning and came in better than expected.  The overall number was right in line at -0.2% but the retail number not counting car purchases was up more than double at 0.5% while the analysts were expecting a 0.2% gain.

Better than expected news should be good for the stocks in hopes of a mild or no recession and bad for bonds as money moves out of bonds and into stocks thus causing mortgage bond yields to drop and mortgage interest rates to rise.

Comment balloon 2 commentsBryan Flynn • May 13 2008 08:35AM

Comments

Mortgage rates should be a lot lower with all the rates cuts we have had.  It is criminal how the trouble lenders are taking advantage of the spread for thier own gain.

Posted by Jim Crawford, Jim Crawford Atlanta Best Listing Agents & REALTOR (RE/MAX Paramount Properties) over 10 years ago

Jim that is not the way it works at all.  When the Fed cuts rates, those are short term rates that affect, credit cards, home equity lines of credit, and short term loans.  Mortgage rates, 30 year and 15 year fixed are determined by mortgage bonds that are traded on Wall Street.  When the Fed cuts rates, that puts pressure on inflation and inflation puts pressure on bonds because the value of the bond decreases.

Posted by Bryan Flynn, Central Mass and Worcester Mortgages (Regency Mortgage Corporation) over 10 years ago

Participate