Monday Market Commentary: All Eyes on the FED

by Alex Stenback on October 29, 2007

1029rates
                                                                        Image via MSNBC
Last Week:
Rates were basically unchanged for the week as the collective markets digested a mixed bag of news – from huge writedowns and losses in housing related sectors (financials & home builders) to major earnings beats in the tech space, to some flight to quality activity which drove bond yields down ahead of the Fed meeting this week.
This Week:
All eyes on the Fed (the FOMC meets Wed/Thurs.) The markets expect a .25% cut to the Fed Funds rate.  To a large degree, this cut has already been baked into the cake.  If you’ll recall the last Fed cut on Sept 18th, mortgage rates actually rose a bit after the cut, but have now recovered to their before-cut levels in anticipation of this next move.  Always remember – a Fed cut does not mean mortgage rates will drop – so tread carefully.
This Weeks Economic Calendar [Barron’s}

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