Mortgage interest rates peaked about month ago and have been on a downward trend since then. This week, rates may flatten out as investors weigh the latest economic data and try to suss out whether the recovery is in fact faltering or picking up steam.
Here's a recap of the numbers:
The Bureau of Labor Statistics reported that the national unemployment rate stayed at 8.9 percent in February, as the economy added 192,000 nonfarm payroll jobs, mostly in manufacturing, construction, professional and business services, health care and transportation and warehousing. However, 13.7 million people are still out of work; 8.3 million are involuntarily working only part time; and 2.7 million who looked for work during the last 12 months didn't do so during the recent four-week period. The unemployment rate for teenagers was nearly 24 percent.
The Institute for Supply Management in Tempe, Ariz., reported that manufacturing activity expanded for the 19th consecutive month in February, and new orders grew significantly faster than inventories. Nonmanufacturing activity also expanded for the 15th consecutive month. But housing-related industries continued to struggle; new orders dipped slightly in the services sector; construction services contracted; manufacturers reported rising prices for commodities and raw materials; and other prices also were on the rise.
The International Council of Shopping Centers in New York reported that U.S. chain stores posted a 4.2 percent gain in same-store sales in February compared with February one year earlier. Chief Economist Michael Niemira said in a statement that stronger labor markets, better economic conditions and the payroll tax reduction more than offset the potentially negative effect of higher fuel and food prices on consumer psychology.
Whether these trends will continue is difficult to predict, especially given the wild card of oil and gas prices. If the data add up to a strengthening recovery, mortgage interest rates could be headed higher. If not, today's low rates could last a while longer.
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