For the fourth consecutive month, the Eleventh Federal Home Loan District Cost of Funds Index has increased.According to the Federal Home Loan Bank of San Francisco, the index for September stood at 1.931%, a rise of nearly 6 basis points from 1.875% in August. Another interesting point is that the new index is slightly above the index for September 2003, when it was 1.923%. COFI is a lagging indicator, generally moving three to six months behind other rates. In May the 10-year Treasury yield, according to data on Yahoo!, ranged from 4.50% to 4.85%. For October the yield ranged from 3.97% to 4.24%, closing at 4.03% on the last business day of October. However, short-term rates are moving in the opposite direction. On May 1, according to data compiled by the Federal Reserve Bank of St. Louis, the secondary-market rate on the one-month certificate of deposit stood at 1.05%. For the week of Oct. 22, the rate was 1.88%. During the same period, the rate on the three-month CD rose from 1.20% to 2.04%, and the six-month CD rate increased from 1.46% to 2.18%.

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