Market Update: Rates Fall; New Home Sales and Fed Interest Rate Decision Coming Up This Week |

Abstract

Market Update: Rates Fall; New Home Sales and Fed Interest Rate Decision Coming Up This Week Blog posted On July 25, 2022 Last week, mortgage rates trended down to two-week lows due to weak economic data in the U.S. and announcements from the European Central Bank. The Philadelphia Fed Index resulted in a chart that pointed to big economic weakness, which is good news for interest rates. Lower rates in Europe can influence rate trends in the U.S. The new home sales report tracks the sales of newly constructed homes and accounts for about 10% of total residential real estate transactions. In May, new home sales soared 10.7% to a seasonally adjusted annual rate of 696,000 units. The Federal Open Market Committee sets the federal funds rate. The federal funds rate will influence mortgage rates but not set them exactly. Inflation is the enemy of bonds and therefore rates.