Fear of Inflation Easing

Bloomberg reports that the mortgage-bond yield has dropped five days in a row.

June 17 (Bloomberg) — Yields on Fannie Mae and Freddie Mac mortgage securities declined for a fifth day, tracking a drop in rates on benchmark U.S. Treasuries and suggesting further declines in borrowing costs for new home loans.

Fears of inflation may be declining leading to the fall in long term borrowing costs:

Treasuries and so-called agency mortgage bonds rallied after a government report showed the cost of living rose less than forecast in May. The mortgage-bond yields are down from 5.07 percent on June 10, the highest level since the Federal Reserve announced plans to buy home-loan bonds in November.

There were some stats on the CPI as well:

The consumer price index increased 0.1 percent in May after no change a month earlier, capping the biggest 12-month decline since 1950, the Labor Department said today in Washington. Economists forecast consumer prices rose 0.3 percent, according to the median of 75 projections in a Bloomberg News survey.

Read the full article here.

The decreasing rates mean more cashflow for the investors Brewer Caldwell works with on a daily basis. We are buying homes at the Maricopa County Courthouse every day for prices not seen since the nineties.

Travis J. Bohling
Brewer Caldwell Property Management
480-212-7041 (Direct Line)
480-212-7042 (Fax)
Travisb@brewercaldwell.com

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