Weekly Mortgage Update: 30yr Fixed 3.75%, 15yr Fixed 2.875%Posted by Emily Ray-Porter on Monday, July 2nd, 2012 at 7:05am.
For most of the week, expectations for action from the European Union (EU) Summit were very low, but EU officials surprised investors on Friday with the announcement of a plan to recapitalize European banks and to help reduce borrowing costs for Spain and Italy. Essentially, Germany agreed to an increased level of aid in return for the eventual creation of a single supervisor for all banks in the EU. Details of the plan have not yet been worked out. After the news, investors shifted to riskier assets, partially reversing actions earlier in the week.
While most of the attention was on Europe and the Supreme Court, the housing data released this week was encouraging. May New Home Sales rose 8% from April to the highest level since April 2010, when the homebuyer tax credit was about to expire. May Pending Home Sales rose 6% from April, also to the highest level since April 2010. Record low mortgage rates and high Affordability levels are helping the housing market.
The biggest economic report next week will be the important Employment data on Friday. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month.