residential foreclosures hit its highest level

The number of new residential foreclosures hit its highest level of the year in July, while the active foreclosure inventory for the month actually dropped 3.1 percent from the June level, according to Foreclosure.com, a company that tracks foreclosure information.

There were 28,130 new residential foreclosures in July -- a 4.95 percent increase over June and a 10 percent increase from July 2005. Michigan, Colorado and Ohio were among the states hardest hit..

The largest monthly increases in new foreclosure rates among states with more than 300 new foreclosures were recorded in Alabama (up 21.3 percent); Colorado (up 12.9 percent); Illinois (up 11.6 percent); Michigan (up 38 percent); Minnesota (up 31.1 percent); Missouri (up 48.2 percent); and Ohio (up 14.3 percent).

California's new foreclosures dipped by 41 percent from June to July, while the active inventory increased by 7.3 percent.

Other large monthly percentage decreases in new foreclosures were found in North Carolina (down 14.3 percent); Pennsylvania (down 21.3 percent); and Texas (down 16.9 percent).

Fed takes a break from interest-rate hikes

Fed takes a break from interest-rate hikes
Federal funds rate stays put at 5.25%

The Federal Reserve on Tuesday ended two years of 17 consecutive increases in the federal funds rate, letting it stay put at 5.25 percent.

The Federal Open Market Committee may not be done raising interest rates to keep inflation in check, saying "some inflation risks remain." But unemployment in July rose from 4.6 percent to 4.8 percent and economic growth slowed to 2.5 percent this spring, off by nearly half from the pace of the first three months of the year.

"Economic growth has moderated from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices," the committee said in a statement. Inflation risks remain, and "The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information."
The decision to take a break from interest-rate hikes was expected, and long-term mortgage rates had already fallen to four-month lows in anticipation of the move. The 30-year fixed-rate average sank to 6.07 percent overnight, and the 15-year rate dipped to 5.78 percent.