Mortgage rates decline in week
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The average 30-year fixed rate fell to 6.31% vs. 6.46% the week prior,
while average 15-year rates dipped to 5.97% from 6.31%. One-year ARMs
fell to 5.66% from 5.74%, Freddie Mac said. The government-sponsored
lender said the dip could "give some relief" to borrowers looking to
refinance loans or buy a home.
U.S. budget deficit nears $117 bil
The Aug. federal deficit rose almost 81% from Aug. '06 and was almost
$30 bil higher than forecasts. Much of the jump was due to the Labor Day
holiday that shifted some $44bil of Medicare and Social Security
payments into Aug. from Sept. The U.S. deficit for the first 11 months
of fiscal '07 has shrunk 9.8% to just over $274 bil.
Back-to-school helps retail sales
Aug. retail sales rose 0.3% as modest gains continue on decent demand
for apparel and electronics, SpendingPulse said. Sales were above July's
0.2% rise. Core sales, which exclude cars, gasoline and building
materials rose 0.4%, down from July's 0.7% rise. Sales remain generally
slow as the slumping housing market hurts consumers.
The Bank of England eased some deposit restrictions on commercial banks
to encourage lending and added $7.9 bil to money markets. It's the BoE's
first move to provide extra liquidity since credit markets weakened in
early Aug. China's industrial production rose 17.5% in Aug. vs. a year
ago. That's strong, but growth slowed for a second month as industry
reacts to higher taxes on exports. Russia's foreign reserves rose to
$417.1 bil in the week ended Sept. 7, up $1.1 bil from the prior week.
Russia currently has the world's third-largest reserve surplus. The ECB
said it will act in a "firm and timely manner" to resume its inflation
fight once current market turmoil subsides. The bank left rates
unchanged at 4% on Sept. 6. COMING UP FRIDAY
Retail sales for Aug., 8:30 a.m. EDT (forecast: 0.5%; 0.2% ex autos).
Industrial production for Aug., 9:15 a.m. EDT (forecast: 0.3%; 82%
capacity utilization). Business inventories for July, 10a.m. EDT
(forecast: 0.3%).
