Financial Watch

Interest rates fell in the bond market Thursday after concerns grew that a bailout for Greece might not be enough to help the country through its fiscal crisis.

Renewed questions about the Greek government’s ability to make its debt payments have pushed its borrowing costs higher. Investors outside Greece don’t want problems there to spill to other markets. That drove up demand for Treasurys.

Prices on Treasurys rose and yields dropped.

The Greek government on Thursday asked the European Union and the International Monetary Fund for greater insight about potential financial aid. Officials from the EU and the IMF are scheduled to meet with Greek leaders on Monday.

San Francisco Federal Reserve President Janet Yellen said her own thinking has turned the corner, and she’s now confident “the economy is on the right track,” according to remarks prepared for delivery before a meeting of Financial Executives International.

“I expect the pace of recovery to gain momentum over the course of this year and next as households and businesses regain confidence, overall financial conditions continue to improve, and lenders increase the supply of credit,” she said, in the prepared text.

“Even as we applaud the economic turnaround, it’s important not to lose sight of just how fragile this recovery is and how far we yet have to go before things return to normal.”

After rising for a month, the average interest rate for a 30-year fixed loan declined to 5.07% this past week from 5.21% the previous week, Freddie Mac said in its weekly survey of lenders.

Fixed-rate 15-year mortgages, a popular option for people refinancing to pay off their homes more quickly, averaged 4.40%, down from 4.52%.

Rates on adjustable mortgages also fell slightly, Freddie Mac said. A news release on the survey was expected to be posted later Thursday.

Interest rates fell in the bond market Monday ahead of a parade of corporate earnings reports.

The profit levels and forecasts from companies will give investors important clues about the strength of the economy. The uncertainty about the outlook made some investors cautious and increased demand for safe investments.

Treasury prices rose and yields dropped as well because investors got a break from the flow of new debt entering the market. The Treasury Department last week auctioned $82 billion in debt. The next auctions aren’t for two weeks.

The Obama mortgage debt relief plan was designed to help homeowners stay in their homes and avoid foreclosure. If you have had difficulty making your monthly mortgage payment then you should consider going through a mortgage refinance to lower your interest rate. Another option is going through home loan modification.

If you have a good credit score, above 740, and a significant amount of equity in your home then there is a good chance that you can refinance to a lower interest rate in the current economic environment. Please be aware of the fact that mortgage rates are likely to move up in the near future so you will want to take action soon.

Federal Reserve Chairman Ben Bernanke Thursday said record-low interest rates are still needed to support the U.S. economy, but the central bank has to be ready to tighten credit to prevent inflation.