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Mortgage rates drop again on low inflation, data
By Palm Beach Business.com
DELRAY BEACH — Mortgage rates dropped for a second consecutive week as mixed economic data pushed investor money toward long-term Treasurys, according to both Freddie Mac and Bankrate.
Freddie’s Primary Mortgage Market Survey found the average 30-year fixed-rate mortgage dropped to 3.55 percent with 0.7 point from last week’s 3.59 percent. Bankrate spotted the 30-year at 3.79 percent with 0.40 point, down from 3.80 percent a week earlier.
The 15-year fixed-rate held steady at 2.86 percent with 0.6 point, according to Freddie Mac, while rising to 3.04 percent with 0.36 point from an average of 3.03 percent a week earlier, according to Bankrate.
"Mortgage rates were little changed over the holiday week amid mixed economic data releases,” Freddie Mac Chief Economist Frank Nothaft said. “Although consumer spending rose 0.4 percent in July, representing the largest gain in five months, the core price index was unchanged suggesting little threat of inflation. Consumer confidence picked up slightly in August according to the University of Michigan, but remained below this year's peak in May. And the manufacturing industry contracted for the third consecutive month in August."
Bankrate noted that Fed Chair Ben Bernanke's speech last Friday in Jackson Hole, Wyoming, left open possibility that the central bank will take further action to stimulate the economy. Bond yields and mortgage rates moved lower in response. Friday’s job report will be critical in determining whether the Fed acts at their meeting this month or defers until later in the year. While markets are expecting the Fed to act next week, it would take a weak jobs report to truly seal the deal.
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