Most homeowners probably don't know what it is--or even how to pronounce it. But the London Interbank Offered Rate, or Libor, is having a noticeable impact on adjustable rate mortgages.
Turmoil stemming from subprime mortgage delinquencies could dampen demand for homes and ultimately slow economic growth, Federal Reserve Governor Randall Kroszner said Thursday.
Turbulence buffeting global financial markets risks tipping economies into recession but policy makers must avoid overreacting to it for fear of making the situation worse, St. Louis Federal Reserve Bank President William Poole said on Thursday.
U.S. service sector growth held steady in August, although employment conditions deteriorated to their weakest level in nearly five years, according to a report released Thursday.
A gauge of U.S. labor demand was higher in August but recruitment activity recovered lessthan it typically does in the month, in another sign of a cooling job market, a report said Thursday.
Financial market turbulence leading to tighter mortgage lending standards noticeably hurt housing activity in most Federal Reserve districts in recent weeks, adding uncertainty about the recovery of the downtrodden housing sector, the Fed said on Wednesday.
Pending sales of existing U.S. homes plunged by a record 12.2 percent in July, and private employers hired the fewest workers in more than four years in August, according to reports released Wednesday that point to a weakening U.S. economy.
Applications for U.S. home loans rose last week, while the highest adjustable rate mortgages in over six years put another nail in the coffin of the once-torrid sector, an industry group's data showed on Wednesday.
Richmond Federal Reserve Bank President Jeffrey Lacker said on Tuesday he would back an interest rate cut if the evidence pointed to slowing U.S. economic growth and diminished inflation, but he warned that this outcome was by no means automatic.
Economics is known as an imprecise science and one might need look no further than the business of calling recessions to see that. Unlike the weather, recessions arrive before you know it and depart under the same circumstances.
"It is not the responsibility of the Federal Reserve--nor would it be appropriate--to protect lenders and investors from the consequences of their financial decisions. But developments in financial markets can have broad economic effects felt by many outside the markets, and the Federal Reserve must take those effects into account when determining policy."
The Fed will take the necessary steps to shelter the economy from turmoil in financial markets but will not bail out investors, Chairman Ben Bernanke said.
President Bush outlined reforms on Friday aimed at helping subprime mortgage borrowers. This marks the administration's first public response to the subprime housing crisis since the problem began gathering in February.
Here are the latest video reports from Jackson Hole, Wyo., where Federal Reserve Chairman Ben Bernanke said that the central bank is prepared to act "as needed" to help provide liquidity to the financial system but won't bail out investors who made bad decisions.
On Friday, Federal Reserve Chairman Ben Bernanke will address the annual monetary conference held in Jackson Hole, Wyo. Amid the U.S. subprime mortgage mess, tightening global credit and a volatile market, everyone is waiting on what Bernanke will say -- and do.
Economic data released Friday showed inflation under control in July while U.S. factories were busier than forecast, portraying a resilient economy in little need of an interest rate cut.
President Bush outlined reforms to help struggling subprime mortgage borrowers. This is the president's first formal response to the subprime housing crisis since the problem began snowballing this past February.
Core U.S. consumer prices rose by a less-than-expected 0.1 percent in July, showing stable prices that held the year-on-year rate of nonfood, nonenergy inflation to 1.9 percent for the second month in a row, the Commerce Department said Friday.
Inflation numbers are good for those who want a rate cut. The PCE deflator shows moderating inflation. U.S. futures--as well as European bourses--are also rallying because of President Bush's proposal to help homeowners who cannot pay their mortgages.