There was, for example, very little movement among interest rates over
the past week. Mortgage rates declined by about 4 basis points in most
cases, and Treasury securities yields were down by less. The calm in
this market seems sustained by, on the one hand, a slowly growing
confidence among investors (which will eventually lead to higher rates)
and, on the other, continuing concerns that the credit markets may be
rocked by the debt problems in the euro zone. For this latter reason,
world investors continue to flock to the relative safety of American
Treasury securities, and interest rates, in heavily-bid auctions,
remain low.
Meantime, the weekly report on unemployment insurance claims continues
to give us a slight decline—5,000 fewer new claims each of the past two
weeks, for example. This is not great news, but it is good news, a
salve to any remaining worries that we might see further job losses.
The Conference Board Index of Leading Indicators advanced again in
February, but this time by only 0.1%. “The leading index suggests that
the recovery is maturing and the economy will settle into a slower pace
of growth for the second half of the year,” explains Michael Bratus of
Moody’s Economy.com. Again, good news but not great news.
Lastly, to the moment of writing this update, the report on
Existing-Home Sales shows a 0.6% decline in the number of sales from
January to February of this year. What is good here is that the decline
has not appreciably deepened since the extraordinary drops in December
and the striking decline in January. What is far from great, though, is
that we really haven’t recovered our sales volume in real estate
resales since the big declines.
We do, however, have stronger sales in some markets, notably
California. And we have a company like FedEx—whose shipping and
delivery business rises and falls on the strength or weakness of world
markets—reporting fiscal third quarter profits that more than doubled
those of last year. And that, it turns out, is great news. We expect
more great news, but it will probably continue to come gradually and
unevenly.
March 24, 2010
KEY INDICATORS [3/23/10 close]
Gold $1101.80/ounce [down]
Crude Oil (Brent) $80.43/brl
[up slightly]
U.S. Dollar to…
Euro .7407 [up]
Japanese Yen 90.40 [down]
6-mo Treasury Bill Yield 0.22%
10-yr Treasury Note Yield 3.66%
[6-mo down 1 bp, 10-yr down 2 bps]
11th Dist Cost of Funds 1.786%[-]
30-yr Fixed-rate Mortgage 5.30%
15-yr Fixed-rate Mortgage 4.77%
1-yr ARM 4.57%
[HSH averages rates: 30-yr
down 4 bps,15-yr down 4 bps; 1-yr ARM down 21 bps]
Mortgage Bankers Association Mortgage Applications Index
week ending 3/12
Overall
620.9 (down 1.9%; up 0.5%
the week prior)
Purchase Money Loans
221.5 (down 2.3%; up 5.7%
the week prior)
Refinancing Loans
2955.9 (down 1.7%; down 1.5%
the week prior)
Jobless Claims 3/13
457,000 – prior week 462,000 – continuing claims rose to 4.579 m
Producer Price Index (PPI) Feb
Down 0.6% - core (with food & energy prices removed ) up 0.1%
Consumer Price Index (CPI) Feb
Unchanged – core up 0.1%Last changed: Mar 23 2010 at 10:59 PM
