Monday Market Commentary

by Alex Stenback on April 25, 2005

Uptown_bridge_4Last Week:  Rates Down Slightly
Despite the spike in consumer prices revealed by Wednesday’s CPI figures (core prices, excluding food and energy up .4%) the market managed to eek out a small gain for the week, with most mortgages improving in price by about 1/8 of a discount point by Friday’s close.
This Week: Emp. Cost Index, First Q GDP Rev.
This week is rich with data releases, but the first quarter Employment Cost Index and revised GDP will get most of the attention from the markets.  While a downward revision of GDP could move rates lower, a spike in labor costs (economists expect a .1% gain) will likely cause rates to rise. In the words of one market expert we follow: "If the Employment Cost Index shows that labor costs are rising rapidly – the inflation beast will roar and thump its chest – and mortgage investors will be in a full-out selling panic."
·This Weeks Economic Calendar

*Image "Uptown Bridge" by Uptown photoblogger Black Java

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