QUOTE OF THE DAY “We have matters that are under investigation. I expect to be making further announcements in the coming weeks, the coming months.” Eric Holder, U.S. attorney general, on investigations of JPMorgan Article,1D30-year mortgage rate falls to 4.32%
WASHINGTON - Average U.S. rates on fixed mortgages fell this week to their lowest point in two months.
The decline comes after the Federal Reserve’s decision last week to hold off slowing its monthly bond purchases.
Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan dropped to 4.32 percent from 4.50 percent last week. The average on the 15-year fixed loan declined to 3.37 percent from 3.54 percent.
Both are the lowest averages since July 25.
Mortgage rates are nearly a full percentage point higher than in May, when the Fed first signaled it might slow its $85-billion-a-month in bond buys. But last week the Fed kept the pace steady after lowering its outlook for economic growth.
The bond purchases are intended to lower long-term interest rates, including mortgage rates.
To calculate average mortgage rates, Freddie Mac, the Federal Home Loan Mortgage Corp., surveys lenders across the country on Monday through Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was steady at 0.7 point. The fee for a 15-year loan also was unchanged at 0.7 point.
The average rate on a one-year adjustable-rate mortgage slipped to 2.63 percent from 2.65 percent. The fee was unchanged at 0.4 point.
The average rate on a five-year adjustable mortgage dipped to 3.07 percent from 3.11 percent. The fee held at 0.5 point.
Iron plant delayed after dome collapses
Nucor Corp., the largest U.S. steelmaker by market value, delayed the opening of an iron-production mill under construction in Louisiana until the end of the year after a storage dome collapsed.
The plant, which will be the world’s largest producer of direct-reduced iron, was scheduled to begin production within a few weeks, the Charlotte, N.C.-based company said in a statement Thursday. There were no injuries and no environmental damage was discovered, the company said. The dome was one of three on the site.
Direct-reduced iron uses natural gas to process iron ore so that it can be used in electric furnaces such as those Nucor uses to produce the metal. The $750 million plant in St. James Parish, La., is expected to produce 2.5 million tons of direct-reduced iron a year, Nucor said.
Katherine Miller, a spokesman for Nucor, declined to comment on the cause of the collapse.
Nucor shares slipped 41 cents to $49.08 at 11:33 a.m. in New York. The shares have risen 14 percent this year.
U.S. sells GM shares, cuts stake to 7%
NEW YORK - The U.S. government is starting another phase of selling off its General Motors stock after cutting its stake in the automaker to a little more than 7 percent.
The Treasury Department said it still owns 101.3 million GM shares. It got 912 million shares, a 60.8 percent stake in the company, in exchange for a $49.5 billion bailout of GM in 2009. So far taxpayers have recovered about $35.4 billion. That means they’re still about $14.1 billion in the hole.
To break even, the remaining shares would have to sell for nearly $140 each. At the Thursday morning trading price of $36.92, the government would get about $3.7 billion more. So taxpayers are likely to lose about $10 billion on the deal.
The Treasury plans to sell all of its shares by April 1.
The bailout was authorized under both the Bush and Obama administrations during the financial crisis in 2008 and 2009. At the time, GM’s sales had plummeted and it nearly ran out of cash to make payroll and service billions of dollars in debt.
The government said at the time that the bailout was necessary to save the American auto industry and stop the industrial Midwest from sliding into a depression. The Obama administration says bailing out GM and Chrysler saved more than a million American jobs.
The Treasury Department said it finished the second phase of selling GM stock Sept. 13.
“The third trading plan will allow us to continue exiting the investment in accordance with our previously announced timetable while maximizing the taxpayer’s return,” Tim Massad, assistant treasury secretary for financial stability, said in a statement.
- The Associated Press
Business, Pages 26 on 09/27/2013