Economic News
If you are unable to view the message below, please click here.
Kenton Becker
Loan Officer
Office: (206) 423-2552
NMLS #123961 ,
Washington #MLO-123961

Events Last Week:

Import Prices Fell
Sentiment Lower
Jobless Claims Rose
Manufacturing Mixed

Events This Week:

Mon 7/15
Retail Sales
Empire State

Tue 7/16
Industrial Prod.

Wed 7/17
Housing Starts
Beige Book

Thur 7/18
Philly Fed
Leading Indicators




landhome landhome

Fed Policy Drives Rates

The primary influence on mortgage rates last week was shifting expectations for Fed policy. Fed Chief Bernanke eased investor concerns about tighter monetary policy, causing mortgage rates to end the week lower, reversing a good portion of the prior week's increase.

To boost the economy in recent years, the Fed has used a variety of tools, which helped push mortgage rates down to historically low levels. Now that the economy is improving, Fed officials have indicated that it may soon be time to begin to scale back one of its tools, the bond buying program. As expected, mortgage rates reacted to the announcement on June 19 by climbing higher, but the magnitude of the move surprised many investors. Since then, there has been a great deal of uncertainty about the timing for the Fed to begin to tighten monetary policy. Volatility has been extremely high, as economic reports and comments from Fed officials have caused investors to adjust their expected timelines almost daily.

Following the stronger than expected Employment data released on July 5, investors shifted forward their expectations for Fed tightening, and mortgage rates swiftly increased. Sentiment reversed last week, however, due to a speech late Wednesday by Bernanke. The Fed Chief strongly stated that Fed officials feel that "highly accommodative" monetary policy will be appropriate for a long time. Bernanke's comments soothed investors, causing stocks to rise and mortgage rates to fall.

Also Notable:
  • Core PPI inflation was 1.7% higher than one year ago
  • S&P downgraded the sovereign debt of Italy
  • The Dow stock index reached a record high
  • Oil prices rose to the highest level since May 2012


Average 30 yr fixed rate:
Last week: +0.35%
This week: -0.25%
Stocks (weekly):
Dow: 15,500 +500
NASDAQ: 3,575 +125

This Week

Retail Sales will be released on Monday. Retail Sales account for about 70% of economic activity. CPI will come out on Tuesday, along with Industrial Production. The Consumer Price Index (CPI), the most closely watched monthly inflation report, looks at the price change for those finished goods which are sold to consumers. Housing Starts and the Fed's Beige Book will be released on Wednesday. Philly Fed, Empire State, and Leading Indicators will round out the schedule. Investors also will be paying close attention to comments from Fed officials.

©2013 MBSQuoteline

Equal Housing Opportunity Lender. Rates, Program, Fees, and Guidelines are subject to change without notice. Not a commitment to lend. Land Home only conducts business in states we are approved to. Land Home Financial Services, 22525 SE 64th Place, Suite 220, Issaquah, WA 98027. Washington Consumer Loan License #CL-89331. NMLS ID # 89331. Kenton Becker Licenses: NMLS #123961; Washington #MLO-123961. You are receiving this communication because of an existing and/or past business relationship, or because you have consented to receive communications from Land Home. 07-15-13  
301 116th Ave SE Suite 200, Bellevue, Washington, 98004
This is a 1x1 transparent image tracking traffic