Mortgage Interest Rates decline slightly

Mortgage interest rates for buying a home on the Palos Verdes Peninsula decreased slightly this week. The following are excerpts from the newsletter on interest rates published by HSH Associates :

“Financial markets and investors wholly expect at least a quarter-point cut in the federal funds rate next Wednesday, and the Fed has taken sufficient steps to manage that expectation. With a small “insurance” move a done deal (and already priced in to stocks and bonds) the more pressing issue is “What will the Fed reveal about future policy thinking, if anything?”

With market and Fed-engineered interest rates already low, the Fed’s posturing is arguably more important than the coming small move in the overnight, intra-bank lending rate. Outside of manufacturing and agriculture — both battered by erratic trade policies and tariffs — the economy here is in pretty good shape, and central banks around the world have begun taking steps to help shore up their local economies. If the present “truce” with China can hold, or even be resolved amicably, odds favor that somewhat better economic fortunes lie ahead on a global basis.

There’s precious little new data due out next week before the Fed meets and it’s unlikely that anything in the reports covering personal income, consumer confidence or the employment cost index will change anything as it pertains to the policy decision. The market will get what it has been agitating for, a cut in rates; the President will likely be unsatisfied and will continue bleating as is his wont. From our perspective the small move in short-term rates doesn’t mean very much and won’t change the general outlook greatly. However, if the statement at the close of the Fed meeting (ay any discussion in Chairman Powell’s post-meeting press conference) intimates a move back toward a policy of “patience” or infers that, just as diminishing global growth helped the Fed to consider moving rates lower that the inverse is likely just as true, we would expect to see longer-term rates and mortgage rates stabilize with perhaps a little upward bias. Of course, any sustained move upward, however mild, is all pending inbound data from here and overseas that improvement is occurring. Based upon where we finished this week and with little data to move the market before Freddie Mac’s next survey comes next Thursday, odds favor very little change to mortgage rates.”

The following are interest rate quotes from John :Alvin of American California Financial Services, Inc. :

For more information about Palos Verdes and South Bay Real Estate and buying and selling a home on the Palos Verdes Peninsula, visit my website at https://www.maureenmegowan.com . I try to make this the best real estate web blog in the South Bay Los Angeles and the Palos Verdes Peninsula. I would love to hear your comments or suggestions.