Inflation, as measured by the Consumer Price Index (CPI), remains tame as the CPI increased only 0.1% in March, and excluding food and energy was unchanged. In addition to the CPI the markets saw strong earnings reports from Intel and JP Morgan Chase, which has moved the U.S. stock markets higher.
Federal Reserve Chairman Ben Bernanke stated in testimony to congress this morning the U.S. economy will see moderate recovery, however, the headwinds of high unemployment, continued weakness in residential and commercial real estate, and the poor condition of many state and local governments will retard growth. It seems clear the Fed is in no hurry to increase interest rates.
Bond prices have moved lower today, mostly the result of investors moving into the stock market. Mortgage prices are approximately .125% worse than Tuesday.
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