Mortgage rates have fallen to the lowest level of the year as European turmoil caused investors to pour money into the safe haven of U.S. government securities.
The average rate on a 30-year fixed rate mortgage dipped to 4.78 percent this week from 4.84 percent a week earlier, mortgage company Freddie Mac said. It was the lowest level since early December, when rates fell to a record low of 4.71 percent. Rates on five-year, adjustable-rate mortgages averaged 3.97 percent, up from 3.91 percent a week earlier.
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The economic rebound last quarter turned out to be slower than first thought, one of the reasons unemployment is likely to stay high this year.
The economy grew at a 3 percent annual rate from January to March, the Commerce Department said Thursday. That was slightly weaker than an initial estimate of 3.2 percent a month ago. The new reading, based on more complete information, also fell short of economists’ forecast for stronger growth of 3.4 percent.
The reasons for the small downgrade: consumers spent less than first estimated. Same goes for business spending on equipment and software. And, the nation’s trade deficit was a bigger drag on economic activity.
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Jobless claims: The number of newly laid off workers filing claims for unemployment benefits dropped last week but the level still remained higher than expected, indicating only modest improvements in the job market.
Applications for unemployment benefits fell by 14,000 to 460,000 last week, the Labor Department reported Thursday. Analysts had expected the level would fall further to 455,000.
Economists say they will feel confident about sustainable job creation once weekly first-time claims dip below 425,000.