The Fed left the Fed Funds Rate unchanged again today for the seventh time in a row after 17 consecutive hikes. But, we knew that was going to happen. The Fed's press release highlights a growing concern in mortgage markets: growth is slowing overall even as inflation threats remain.
This combination is sometimes called stagflation, but has also be referred to as "slowflation" by economists that don't want to invoke memories of the early-1980s interest rate cycle.
Mortgage markets did not take favorably to the Fed's press release and mortgage rates are slightly higher this morning.
Source
Parsing the Fed Statement
The Wall Street Journal Online
May 9, 2007
http://online.wsj.com/public/resources/documents/info-fedparse0705.html
