China Reassures about European Debt

The economic data took a backseat to events in Europe again this week. Improved sentiment about the troubles in Europe influenced the willingness of investors to purchase riskier assets such as stocks, hurting bond markets. As a result, after dropping to the lowest levels of the year, Austin mortgage rates ended the week a little higher.

A report on Wednesday that China was considering a move to reduce its holdings of European debt rattled global financial markets. There had been speculation in recent weeks that China, with the largest pool of foreign exchange reserves in the world, might cut its exposure to European debt. Thursday, however, Chinese officials made rare public comments that China was not planning to make any changes to its portfolio of European investments. Relieved global investors responded by embracing riskier assets such as stocks and partially reversing the effects from a flight to safer assets, such as bonds and mortgage-backed securities (MBS), seen over the last few weeks.

This week’s news from the housing sector was mostly positive. April Existing Home Sales rose 8% to an annual rate of 5.77 million units, the highest level in five months. Inventories of unsold existing homes increased a little, but the median home price was 4% higher than one year ago. First-time buyers accounted for 49% of all existing home sales. April New Home Sales rose 15% to an annual rate of 504K units, above the consensus forecast of 425K, and the highest level since May 2008. The homebuyer tax credit helped boost sales before its April 30 deadline.

About Max Leaman Austin Mortgage

GREAT RATES, LOW FEES, CLOSE ON TIME™ ---- 2012 Ranked #1 Austin Residential Mortgage Lender (Austin Business Journal) 2010, 2011 & 2012 Five Star Professional (Texas Monthly) 2009, 2010, 2011, 2012, 2013 PrimeLending Chairman's Circle Award 2009, 2010, 2011, 2012 Scotsman Guide Top Originator (Top 200 Mortgage Professionals in U.S.A.) Better Business Bureau "A+ Rating" National Lender Rankings (Scotsman Guide): Top Purchase Volume (No. 10) Most Loans Closed (No. 32) Top Dollar Volume (No. 88)

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