09_25_2020_blog

Market Commentary 9/25/20

Interest rates remain low and may go lower as volatility picks up in the equity market. Some of the reasons of this down market includes a very tense upcoming presidential election, a slowing recovery, high unemployment, and a global uptick in Covid-19 cases, just to name the biggest factors. These concerns should benefit bonds near-term. However, there are some positives as the economy has recovered from the March lows. There has been a spark of innovation due to the pandemic and business data indicates that durable goods sales have picked up. There are also some rumblings that Congress is working on additional stimulus relief packages.

The mortgage environment remains very busy as many borrowers are looking for new homes outside of city centers. Many are also seeking to refinance their existing mortgages at these all-time low-interest rates. Banks continue to underwrite applications vigorously while ensuring that the borrowers they qualify will be able to repay their mortgages. Banks share the concern that as COVID cases continue to spike upward, we may face more shutdowns, as the UK has recently enacted. Keep an eye on weekly unemployment claims, which just moved up, as a sign of where the economy is headed.   

(Visited 9 times, 1 visits today)