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Triangle Business Today

Interest rates continue to fall but consumers remain wary

Posted July 1, 2010

Every time we think we’ve seen the best of the rate market, it continues to surprise us and rates go even lower.

We are experiencing unprecedented market movement to the downside. This may not be the silver bullet that housing needs but it certainly is a huge help. Uncertainty in both the domestic and international markets has been just the disaster recipe that we’ve needed to keep interest rates at historic lows. It looks like the Fed will keep its hands out of the interest rate cookie jar for now – so hopefully the market will let both industry and consumers enjoy this ride of affordability for some time.

For those of you who are taking advantage of the tax credit which expired in April of this year – but who may need a tad bit longer to complete your transaction, you may just be in luck. The House of Representatives gave their thumbs up to extending the deadline date to Sept. 30. Now we have to hope that the Senate does their job as well. Stay tuned…

Let’s run down the economic releases for the remainder of the week. Thursday and Friday give us the release of three important indicators: the ISM Index, which is a measure of manufacturing sentiment; the all-important employment report; and the factory orders report.

Unemployment is expected to be at 9.7%, so any major deviation from that figure could present volatility for the markets.

Jobs continue to be of concern for millions of Americans. Unfortunately, it looks as though things are getting tougher for the unemployed. Jobless benefits, which are part of a federal lifeline, are set to run dry for 1.2 million people this Friday. Not to add insult to injury, but the all-telling monthly consumer confidence report, which was released earlier this week, marked a much sharper than expected decline in the confidence of Main Street.

Switching gears to the world of green housing, Duke Energy and Cisco have teamed up to offer consumers the ability to manage their power usage by installing smart grid technology in some homes in the Charlotte and Cincinnati markets. This new technology will hopefully allow consumers to manage their energy use much more efficiently – and in the end help put more dollars back in their pockets. Duke Energy services much of the western portion of the Triangle, and Cisco employs about 4,000 people in the Triangle.

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About this Blog:

Jeremy Salemson, CEO of Corporate Investors Mortgage Group, blogs about economic trends and data and their impact on Triangle business. Each week, he interviews a Triangle-area business leader for a personal look at the local economy.