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Fitch: Spiking rates bad for homebuilder economics

Mar. 19, 2015 9:58 AM ETXHB, ITBBy: Stephen Alpher, SA News Editor3 Comments
  • Showing why it gets the big dollars, Fitch opines that things could get rocky for homebuilders if the Fed hikes interest rates too high, too fast, though reminding that the situation could look decent in the short-term as higher rates could get fence-sitting homebuilders of the schneid.
  • For now, Fitch sticks with its forecast of rate hikes beginning in mid-2015, with the Fed Funds rate hitting 2% by the end of next year.
  • Homebuilders (ITB +1%) are adding to yesterday's post-FOMC gains, helped along today by an earnings beat and positive management comments from Lennar.
  • Previously: Lennar up 2% after strong fiscal first quarter (March 19)
  • Previously: FOMC drops "patient," but sends dovish signal (March 18)
  • XHB +0.7%

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