With the exception of short-term adjustable-rate mortgages, mortgage rates continued their downward spiral last week.
Maybe that’s not such a big surprise, as bad news on the economic front remained front and center. All this even after the U.S. Commerce Department cut its gross domestic product estimation from a 2.4% rise to a 1.6% rise for the second quarter of 2010.
Considering the Commerce Department pegged first quarter growth at 3.7%, the second quarter decline was steep, likely pushing off serious talk of economic recovery for yet another quarter, at least.
This will likely have a big impact on mortgage rates. Right now, the average 30-year fixed mortgage rate stands at 4.445%, according to the BankingMyWay Weekly Mortgage Rate Tracker.
Using the second quarter timeline as a benchmark, the average 30-year mortgage rate on April 5 was 5.28%. At the time, confidence in a full-blown U.S. economy recovery was higher, as was the stock market and consumer confidence.
But that’s clearly not the case today, as the stock market is in full retreat and consumers are once again showing a healthy skepticism for any talk of a rejuvenated economy.
Corporate America is no different — they’re the guys making the biggest impact on one of the economy’s key benchmarks, the U.S. unemployment number, which stands at 9.5%.