COFI Posts Modest Increase

After zooming up 36 basis points between September and October, the Eleventh Federal Home Loan District Cost of Funds Index increased a more modest three basis points between October and November. The Index, as computed by the Federal Home Loan Bank of San Francisco, was 3.155% for November, compared with 3.125% for October. This is the third consecutive increase for this index, which because of its weighted average computation is known as a lagging indicator. Any impact of the Federal Reserve's drastic rate cut is not likely to be seen in COFI for between three and six months from now. To calculate the November index, FHLB-SF used average total funds of $79.3 billion and total interest expense of $208.4 million. More information is located at http://www.fhlbsf.com.