With his famous line, Paul Harvey pointed out for years that there’s more to every story–and often those hidden details influence what happened. Read on to learn the big stories from last week, and the important details to note.
There was good news last week as retail sales increased 1.1% in February, up from 0.2% in January. This marked the biggest gain in the retail sales number in five months. In addition, the National Federation of Independent Businesses (NFIB) reported that its small-business confidence index inched higher in February.
However, it is important to note that the NFIB’s confidence index is still historically low and is below the lowest trough of the 1991-92 and 2001-02 recessions. The NFIB cited slow sales as the main problem.
Inflation was another key story to note from last week. The Producer Price Index met expectations, showing that inflation at the wholesale level remains tame. However, the Consumer Price Index rose by 0.7% in February, coming in above the 0.5% expected. This was also a spike higher from the recent negative and flat numbers. However, inflation continues to remain within the Fed’s target range.
What does all of this mean for home loan rates? Good economic reports like the Retail Sales Report means investors are continuing to move money out of Bonds and into riskier assets like Stocks, to try to take advantage of gains. However, the Fed continues purchasing $85 billion in Bonds every month as part of their Bond purchase program known as Quantitative Easing. And the uncertainty in Europe continues, meaning some investors will likely continue their safe haven trade into our Bond Market. Overall, this should help keep Mortgage Bonds–and therefore home loan rates, which are tied to Mortgage Bonds–near record best levels.
The bottom line is home loan rates remain near historic lows, meaning now is a great time to consider a home purchase or refinance.
Speak Your Mind