"NO MATTER HOW FAR LIFE PUSHES YOU DOWN, NO MATTER HOW MUCH YOU HURT, YOU CAN ALWAYS BOUNCE BACK." WNBA player Sheryl Swoopes. And bouncing back is exactly what Bonds and home loan rates tried to do last week after being pushed to their worst levels of the year.
Bonds and home loan rates managed to hold fairly steady in the first half of the week, despite comments from Philadelphia Fed President Charles Plosser, who said "inflation is too high." Remember signs of inflation typically cause Bonds and home loan rates to worsen, but Plosser also stated that the Fed must "back up their words with action" and hike their benchmark Fed Funds rate. Since a hike by the Fed could lessen inflation...and as a result, cause Bonds and home loan rates to improve...Plosser's inflation comments didn't have as much of an impact on the markets as they could have otherwise.
On Thursday, Bonds managed their biggest rebound of the week after several negative economic reports, including a much higher than expected Initial Jobless Claims report and a lower than expected Existing Home Sales report for June, caused money to flow out of Stocks and into Bonds. However, there was good economic news on Friday as New Home Sales for June and Orders for Durable Goods were far better than expected and the Consumer Sentiment Index shocked the markets with a very robust reading. And good economic news about the economy is bad news for Bonds, which caused money to flow right back out of Bonds into Stocks, keeping Bonds and home loan rates from bouncing back any further.
After all the dramatic ups and downs of the week, Bonds and home loan rates ended the week slightly improved.
GAS PRICES HAVE BEGUN TO IMPROVE, BUT THEY'RE STILL MAKING A BIG IMPACT ON OUR WALLET. CHECK OUT THIS WEEK'S MORTGAGE MARKET VIEW FOR SOME GREAT TIPS ON HOW TO MAKE YOUR GALLONS GO FURTHER.
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