![]() Last week’s economic news included readings from the National Association of Home Builders on housing market conditions and reports on housing starts and building permits issued. Fed Chair Jerome Powell testified before Congress about the impact of Covid-19. Weekly reports on mortgage rates and first-time jobless claims were also released. NAHB: Home Builder Confidence Improves in May Home-builder confidence rose seven points in May to an index reading of 37; April’s reading of 30 was the lowest reading for the NAHB Housing Market Index since June 2012. Low mortgage rates and expectations that the worst of the Covid-19 pandemic had passed contributed to higher readings for builder confidence. Component readings in the Housing Market Index were higher in May; builder confidence in current market conditions rose six points to 42. Builder confidence in home sales within the next six months rose ten points to 46, and the reading for buyer traffic in new housing developments rose from 13 to 21. Readings below 50 are historically common for buyer traffic, but mandatory shelter-at-home rules kept more potential buyers away. NAHB Housing Market Index readings above 50 indicate that most builders surveyed were positive about U.S. housing markets. Readings below 50 indicate that most builders surveyed were pessimistic about housing conditions. Fed Chair Urges Congress to Help Pandemic Victims Fed Chair Jerome Powell testified before Congress and said that those impacted by Covide-19 should receive as much assistance as possible. While Congress approved Federal Reserve Loans to mid-to-large businesses, Mr. Powell reminded Congress that they must also do as much as possible to help low to moderate-income families and businesses and cited a Federal Reserve study that reported 40 percent of households making less than $40,000 lost a job within the first month of the pandemic. Sales of Pre-Owned Homes, Housing Starts, and Building Permits Issued Fall in April The Commerce reported lower readings for sales of pre-owned homes, housing starts, and building permits issued in April. Sales of previously owned homes fell to a seasonally-adjusted annual pace of 4.33 million sales as compared to the March reading of 5.27 million sales. Housing Starts fell to an annual pace of 891,000 starts in April as compared to 1.276 million starts reported in March. The Commerce Department reported 1.074 million building permits issued on an annual basis; this reading was also lower than the March reading of 1.356 million permits issued but was higher than the expected reading of 996,000 permits issued. Mortgage Rates Fall as New Jobless Claims Rise Freddie Mac reported lower mortgage rates last week; the average rate for 30-year fixed-rate mortgages was four basis points lower at 3.24 percent. Rates for 15-year fixed-rate mortgages averaged 2.70 percent and were two basis points lower than for the prior week. Rates for 5/1 adjustable rate mortgages averaged 3.17 percent and were four basis points lower. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.40 percent f04 5/1 adjustable rate mortgages. New jobless claims reported by states fell to 2.44 million claims filed as compared to the prior week’s reading of 2.69 million initial claims filed. The reading for state and federal jobless claims filed rose from 3.21 million to 3.30 million as applicants applied for additional jobless benefits offered through federal pandemic relief programs. What’s Ahead for the Week of May 26, 2020 This week’s scheduled economic readings include Case-Shiller’s Home Price Indices, the FHFA Home Price Index, and data on new home sales. Monthly readings on inflation and consumer sentiment are scheduled along with weekly readings on mortgage rates and new jobless claims. Tuesday May 26, 2020 Consumer Confidence May Tuesday May 26, 2020 New Home Sales April Thursday May 28, 2020 Durable Goods April Thursday May 28, 2020 GDP 2nd Estimate Q1 2020 Thursday May 28, 2020 Core PCE Prices Preliminary Q1 2020 Thursday May 28, 2020 Initial Jobless Claims Week of May 18 Thursday May 28, 2020 Pending Home Sales April Friday May 29, 2020 Personal Income April Friday May 29, 2020 Core PCE Price Index April Friday May 29, 2020 Chicago PMI May Friday May 29, 2020 U of Mich Consumer Sentiment May Have a Great Week! Scott Synovic AnnieMac Home Mortgage Colorado's Mortgage Expert www.coloradosmortgageexpert.com #coloradosmortgageexpert 303.668.3350 Direct NMLS: 253799 / AnnieMac Home Mortgage NMLS: 338923 Regulated by the Division of Real Estate The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors. ![]() Last week’s economic news included readings on inflation, retail sales, and a speech by Federal Reserve Chair Jerome Powell. The University of Michigan released a preliminary reading of its Consumer Sentiment Survey; weekly readings on mortgage rates and initial jobless claims were also released. April Inflation and Retail Sales in Negative Territory Consumer prices fell in April to a negative reading of -0.80 percent and matched expectations. The Core Consumer Price Index, which excludes volatile food and energy sectors, fell to -0.40 percent from -0.10 percent in March. Analysts expected a reading of -0.20 percent. Consumer Price Indices are used for determining inflation rates. Retail sales also posted negative readings for April. Overall, retail sales fell by -16.40 percent as compared to the March reading of -8.30 percent and April’s expected reading of -12.50 percent. Retail sales excluding autos fell by 17.20 percent; analysts expected a reading of -0.90 percent based on the March reading of -0.40 percent. Retail readings may improve in May as retail establishments and malls start to open. Fed Chair Expects Slow Economic Recovery Jerome Powell, Chairman of the Federal Reserve advised business contacts that the economic recovery may be slower than originally expected. In remarks given at the Peterson Institute for International Economics, Mr. Powell said, “The path ahead is both highly uncertain and subject to significant downside risks.” Mr. Powell cautioned that “the passage of time can turn liquidity problems into solvency problem” and suggested that additional government assistance to households and businesses may be worth it to prevent more damage to the economy. Mortgage Rates Mixed; New Jobless Claims Fall Freddie Mac reported little change in average mortgage rates last week. Rates for 30-year fixed-fixed rate mortgages averaged two basis points higher at 3.28 percent. Rates for 15-year fixed-rate mortgages dropped by one basis point to 2.72 percent. Rates for 5/1 adjustable rate mortgages averaged one basis point higher at 3.18 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages. New jobless claims were lower than in the prior week but remained far above traditional readings. 2.98 million claims were filed as compared to the prior week’s reading of 3.18 million initial claims filed. Analysts expected a reading of 2.73 million new claims filed. The University of Michigan released its preliminary Consumer Sentiment Index readings for May. The latest index reading was 73.70 as compared to an expected reading of 69.80 and last month’s reading of 71.80. May’s reading was in line with Chair Powell’s suggestion that consumers are looking ahead to returning to work and shopping as the economy gradually reopens. What’s Ahead for the Week of May 18, 2020 This week’s economic reporting includes readings from the National Association of Home Builders on housing market conditions along with reports on housing starts and building permits issued. Data on existing home sales and weekly readings on mortgage rates and new jobless claims will also be released. Tuesday May 19, 2020 Building Permits April Tuesday May 19, 2020 Housing Starts April Thursday May 21, 2020 Initial Jobless Claims Week of May 11th Thursday May 21, 2020 Philly Fed Business Index May Thursday May 21, 2020 Existing Home Sales April Have a Great Week! Scott Synovic AnnieMac Home Mortgage Colorado's Mortgage Expert www.coloradosmortgageexpert.com #coloradosmortgageexpert 303.668.3350 Direct NMLS: 253799 / AnnieMac Home Mortgage NMLS: 338923 Regulated by the Division of Real Estate The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors. ![]() Last week’s economic releases included readings on public and private sector employment, the national unemployment rate. Economic Destruction Continues as Coronavirus Spreads ADP reported 20.2 million private-sector jobs lost in April as compared to 149,000 jobs lost in March. The government’s Non-Farm Payrolls report showed -20.5 million public and private-sector jobs lost in April as compared to -870,000 jobs lost in March. Both of these jobs reports typically show job growth, but they now report jobs lost due to the coronavirus pandemic and efforts to control it. Likewise, the national unemployment rate grew in April to 14.70 percent as compared to the normal reading of 4.40 percent in March. Mortgage Rates Mixed as New Jobless Claims Fall Freddie Mac reported higher average mortgage rates for 30-year fixed-rate mortgages, which were three basis points higher at 3.26 percent. The average rate for 15-year fixed-rate mortgages fell by four basis points to 2.73 percent. Rates for 5/1 adjustable rate mortgages rose by three basis points to 3.17 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages. First-time jobless claims fell to 3.17 million claims, which exceeded expectations of 3.10 million new claims filed. While new jobless claims were lower than the prior week’s reading of 3.85 million initial unemployment claims, the millions of claims filed were far above normal readings in the hundred-thousands. While jobless claims remain high, they are lower than the seasonally-adjusted peak of 6.90 million initial claims filed in March. Analysts said that unemployment figures would increase as small business claims increase. Credit Card Use Falls In March Consumers stopped using credit cards in March as the coronavirus took hold and the economic shut-down limited shopping, travel, and dining out. Credit card companies tightened lending standards and reduced credit lines as unemployment rates rose. Credit card use fell by nearly 31 percent to – $28.20 billion in March; installment loans including education and vehicle loans rose by 6.20 percent to $16.1 billion. Auto dealers offering attractive incentives including low to no interest rates encouraged consumers to purchase vehicles. Home loans were not counted in the reading for installment loans. Tuesday May 12, 2020 Core CPI April Tuesday May 12, 2020 CPI April Wednesday May 13, 2020 PPI final demand April Thrusday May 14, 2020 Initial Jobless Claims Week of May 4 Friday May 15, 2020 NY Fed Mfg Index May Friday May 15, 2020 Retail Sales April Friday May 15, 2020 Industrial Production April Friday May 15, 2020 Capacity Utilization April Friday May 15, 2020 Business Inventories March Friday May 15, 2020 JOLTS Job Openings March Friday May 15, 2020 U of Mich Consumer Sent. May Have a Great Week! Scott Synovic AnnieMac Home Mortgage Colorado's Mortgage Expert www.coloradosmortgageexpert.com #coloradosmortgageexpert 303.668.3350 Direct NMLS: 253799 / AnnieMac Home Mortgage NMLS: 338923 Regulated by the Division of Real Estate The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors. ![]() Last week’s economic reports included readings from Case-Shiller Housing Market Indices, pending home sales, and inflation. Weekly readings on mortgage rates and first-time jobless claims were also released. Case-Shiller: February Home Price Data Positive Before Coronavirus Impact February data on home prices showed rising home prices; the Case-Shiller National Home Price Index showed 4.20 percent growth in home prices year-over-year as compared to January’s home price growth rate of 3.90 percent. Case-Shiller’s 20-City Home Price Index rose by 0.40 percent from a year-over-year rate of 3.10 percent to 3.50 percent. Home prices increased in all of the 20 cities included in the Index; 17 of the 20 cities reported a greater rate of price growth than for January. Phoenix, Arizona led the 20-City Index with 7.50 percent year-over-year growth in home prices and home prices in Seattle, Washington grew by 6.00 percent year-over-year. Tampa, Florida, and Charlotte, North Caroline were tied for third place with home price growth rates of 5.20 percent. Factors supporting continued home price growth included short supplies of available homes, strong demand for homes, and mortgage rates near all-time lows. Fed’s Federal Open Market Committee Holds Fed Rate Range Steady The post-meeting statement of the Federal Open Market Committee showed no change in the Federal Reserve’s target federal funds rate range of 0.00 to 0.25 percent. The committee expects the ongoing national health crisis to “weigh heavily on economic activity, employment, and inflation in the near term.” FOMC members voted to maintain an accommodative stance on monetary policy until economic conditions again support the Fed’s dual mandate of achieving maximum employment and price stability. Inflation rates were quashed in March as the coronavirus spread in the U.S, The Consumer Price Index fell -7.50 percent in March as compared to February’s growth rate of -0.20 percent. Analysts expected a March inflation rate of -6.90 percent. Core inflation, which excludes volatile food and fuel sectors, fell by -0.10 percent and met expectations but was lower than February’s core inflation reading of -0.20 percent. Mortgage Rates Fall to Record Lows, New Jobless Claims Fall Freddie Mac reported the lowest mortgage interest rates ever recorded with rates for a 30-year fixed-rate mortgage 10 basis points lower at an average of 3.23 percent. Rates for 15-year fixed-rate mortgages averaged nine basis points lower at 2.77 percent. The average rate for 5/1 adjustable rate mortgages fell by 14 basis points to 3.14 percent. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.60 percent for 15-year fixed-rate mortgages, and 0.40 percent for 5/1 adjustable rate mortgages. First-time jobless claims fell last week but remained well above numbers seen before the coronavirus pandemic. 3.84 million new jobless claims were filed, which surpassed expectations of 3.50 million new claims filed and the prior week’s reading of 4.40 million new claims filed. What’s Ahead for the Week of May 4, 2020 This week’s scheduled economic readings include reports on public and private sector jobs, the national unemployment rate, and weekly reports on mortgage rates and new jobless claims. Monday May 4, 2020 Factory Orders March Tuesday May 5, 2020 ISM Non-Mfg PMI April Wednesday May 6, 2020 ADP National Employment April Thursday May 7, 2020 Initial Jobless Claims Week of April 27th Friday May 8, 2020 Non-farm Payrolls April Friday May 8, 2020 Unemployment Rate April Friday May 8, 2020 Average Earnings April Friday May 8, 2020 Wholesale Inventory March Have a Great Week! Scott Synovic AnnieMac Home Mortgage Colorado's Mortgage Expert www.coloradosmortgageexpert.com #coloradosmortgageexpert 303.668.3350 Direct NMLS: 253799 / AnnieMac Home Mortgage NMLS: 338923 Regulated by the Division of Real Estate The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors. |
Archives
February 2023
Categories |