Mortgage Weekly Update - Last Week in Review
Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports. Foster points out that many of these so called "experts" are often more wrong than they are right in their predictions....After Bond prices and home loan rates recently suffered their most dramatic worsening in more than three years, Bill Gross, CEO of monster Bond fund PIMCO, just decided that despite his previous position to the contrary, he is now a self-proclaimed "Bond Bear". Dollar short, day late for that visionary input, Bill. But interesting...he has notoriously been on the wrong side of the crystal ball in recent years - and the significant improvement in Bond pricing over the last several days makes one wonder if Traders are betting the odds, and doing exactly the opposite of what Bill Gross suggests.
Last week started out nasty for Bonds and home loan rates, as Traders continued to sell off Bonds on their fears of continued inflation, and reduced demand for our US Bonds from foreign investors. But later in the week, things began to turn around - dramatically. One big reason was the very welcome news on Friday that inflation actually does appear to be backing down. The Core Consumer Price Index (CPI) measures what we pay for the goods and services that we buy on a regular basis, but pulls out the often-volatile prices of food and energy. The latest read on inflation, which arrived on Friday, indicated that the year-over-year Core CPI dropped to 2.2%...the lowest read in more than a year. This was great news for inflation-hating Bonds and home loan rates, and although the mid-week action was volatile, rates finished up the week about where they had started... Read more.
- Foster Weeks
posted by SFResidence.com @ 9:08 AM
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