Daily Market Update 6/3/08

Mortgage rates remained little changed Tuesday after showing some improvement late Monday. Federal Reserve Chairman Ben Bernanke implied the central bank is unlikely to reduce interest rates further due to mounting inflationary pressures resulting from a weak US Dollar and rising commodity prices. In his first speech on the economic outlook in two months, Bernanke said the Fed is working with the Treasury to “monitor developments in foreign exchange markets” and is aware of the effect of the Dollar’s decline on inflation. Analysts believe his remarks provide further evidence the Fed has shifted its focus from economic stimulus to price stability.

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