Arizona should avoid an economy stall in '07, from the Arizona Republic, reports that economists generally seem to think the United States will avoid a recession in 2007, with Arizona faring a bit better than average. But many forecasters also note that growth is slowing and caution that housing weakness and other potential disruptions could spoil the party. The forecasts came from yesterday's forecast luncheon presented by JPMorgan Chase and the W.P. Carey School of Business at ASU. Lee McPheters, director of the JPMorgan Chase Economic Outlook Center at ASU, said Arizona now ranks first or second in most economic and population-growth measures but is still susceptible to unpleasant surprises from the national economy, for which a "yellow flag" is out. Such surprises could come from inflationary pressures sparked by higher oil prices, a massive terrorist strike or lingering overhang from the housing market.

Mortgage demand rises as rates fall, refinancing surges, from the USA TODAY, reports that mortgage applications rose sharply last week as 30-year fixed-rate mortgages fell to 5.98%, down 0.15 percentage point from the previous week. That's the lowest since Oct 7, 2005. Interest rates were also below year-ago levels of 6.32%. "The decline in mortgage rates and the slowing in home price appreciation, along with the build-up in inventories, has led to a much better situation for home buyers through increased affordability as well as more inventory to choose from," said Dean Maki, chief U.S. economist at Barclays Capital in New York. "Households are saying on surveys that home buying conditions have improved notably, and that has coincided with the stabilization in home sales."

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