The first snapshot of economic growth for the second quarter was quite impressive. This of course make up for the weaker first quarter. Market analysts gave less than a five percent chance of a rate hike at the meeting and they were absolutely correct. Before you get too excited, unless there is a surprise, the strong quarterly data does increase the probability of a hike at the September meeting. Although the jobs outlook was less than expected, the data flows show all systems are set on go.
Rates continue their upward trend in the past week ending August 2nd. According to Sam Khater, Chief Economist, Freddie Mac, --"The higher rate environment, coupled with the ongoing lack of affordable inventory, has led to a drag on existing-home sales in the last few months.” In the meantime, the 30-year fixed rates increased to 4.60% from 4.54% the week before, while 15-year loans rose to 4.08% and the average for five-year adjustable is up 3.93%. A year ago, 30-year fixed rates averaged 3.93%.