00:00Many experts say the U.S. just dodged an economic bullet, with the Fed recently announcing much better than expected
00:06quarterly results with regards to both inflation rates and GDP.
00:10The U.S. is currently at an inflation rate of 2.97%, a far cry from last year's historic highs
00:16of around 9.06%.
00:18But now economists say while that metric is important, it's not the one consumers should be tracking if they want
00:23to know how far their dollar is going to go.
00:25Now, Insider reports that yields on 10-year Treasury bonds are a much better indicator of how the economy is
00:31doing for the everyman.
00:32Recently, those rates jumped, and that's not good.
00:35This week, interest rates for those bonds hiked to 4.1%, albeit briefly, the highest they've been since late 2022.
00:42There are a couple of reasons why this metric is more important.
00:45First, as federal interest rates go up, as they recently did, investors might foresee a future of rising prices, as
00:50the economy might overgrow.
00:52That's when those 10-year Treasury bond rates also go up.
00:55And that increases everyday consumer borrowing costs.
00:58The other reason is mortgage rates are tied to those bond rates as well, as mortgages are often sold for
01:03those very bonds.
01:04Meaning if the interest rate of a 30-year mortgage isn't high enough to trade for those bonds, they will
01:09simply raise the mortgage rates, possibly soon setting new records in that regard.
01:13The other reason is mortgage rates are not low.
01:13The other reason is mortgage rates are not low.
01:14The other reason is mortgage rates are not low.
01:16The other reason is mortgage rates are not low.
01:16The other reason is mortgage rates are not low.
Comments