Florida Mortgage Market – Special Update

by Florida's #1 Mortgage Planner on March 18, 2008

The FOMC has mad its decision and it was 75 basis points.  With consensus moving towards a full 1.00% cut, they at least saved face a little, showing some effort to not simply “appease the markets”. 

Concerns in the report in relation to bonds are the following:

Inflation has been elevated, and some indicators of inflation expectations have risen.  The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization.  Still, uncertainty about the inflation outlook has increased.  It will be necessary to continue to monitor inflation developments carefully.

So the Fed is still downplaying inflation, but acknowledging the fact it may come back and bite them in the butt.

Market reaction is benign so far with bonds down 25bp at the moment and stocks still holding around +280 on the Dow.

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