AgentIndustry News

‘Roaring’ economy hikes real estate rates

U.S. faces 'worst inflation risk in 25 years'

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Strong economic data gave long-term rates a tough time this week, the 10-year T-note rising as high as 5.14 percent and mortgages threatening a lurch to 7 percent, but stabilizing in response to Fed Chair Ben Bernanke's we-may-pause remarks to Congress. The long-term-rate lid has been clamped down by bond market expectations for an economic slowdown, and trust in inflation vigilance at the Fed. Both expectations had less foundation at the end of this week than at the beginning. The economy is accelerating -- roaring, really. First-quarter GDP raced to a 4.8 percent gain on big spending by both consumers and businesses, its internal inflation indicator right at the 2 percent cliff-edge. Housing was supposed to have faltered badly by now, leading a slowdown. Instead of falling, March sales of existing homes were steady; sales of new homes were supposed to flatten and instead surged 13 percent. Consumer confidence has sailed to a four-year high, consistent with a better and better market...