Mortgage Blog - December 16, 2019

Larimer Square, Downtown Denver

Last week’s economic reports included readings on inflation and retail sales; the Federal Reserve released its post-meeting statement from its Federal Open Market Committee. Weekly readings on mortgage rates and new jobless claims were also released.

Inflation, Retail Sales Rate Dip in November
​
The Commerce Department’s Consumer Price Index dipped in November to a growth rate of 0.20 percent as compared to October’s



​growth rate of 0.40 percent. Analysts expected inflation to slow to 0.20 percent growth.

Year-over-year inflation rose to 2.10 percent, which was its highest reading in a year. Analysts said rising rents, energy and healthcare costs caused the higher consumer inflation reading. November’s Core Consumer Price Index was unchanged at 0.20 percent growth. The Core CPI reading excludes volatile food and energy sectors.

Retails sales growth slowed to 0.20 percent in November as compared to October’s growth rate of 0.40 percent and expected growth of 0.50 percent. Retail sales exclusive of autos were also lower in November with a reading of 0.10 percent growth.

Analysts expected a reading of 0.40 percent growth; October’s reading for Retail Sales Excluding Autos showed 0.30 percent growth. Lower retail sales at the start of the winter holiday shopping season could signify cooling consumer confidence in the economy.

Fed Holds Steady on Key Interest Rate Range

The Federal Open Market Committee of the Federal Reserve announced no change to the target federal funds rate range at its meeting on Wednesday. The target range for the federal funds rate remained at 1.50 to 1.75 percent.

The Committee’s post-meeting statement suggested that FOMC members did not plan to change the federal funds rate in 2020 if economic conditions remain stable, but said that monetary policy decisions were flexible and could change as global and domestic economic conditions require.

Mortgage Rates, New Jobless Claims Rise

Freddie Mac reported higher average rates for fixed-rate mortgages last week. The average rate for a 30-year fixed-rate mortgage was five basis points higher at 3.73 percent; rates for 15-year fixed-rate mortgages averaged five basis points higher at 3.19  percent.

The average rate for a 5/1 adjustable-rate mortgage was three basis points lower at 3.36 percent. Discount points rose across the board last week and averaged 0.70 percent for fixed-rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

New jobless claims jumped to 252,000 last week, which surpassed expectations of 220,000 new claims and the prior week’s reading of 203,000 first-time claims filed.

What’s Ahead for the Week of December 16, 2019

This week’s scheduled economic releases include the National Association of Home Builders’Housing Market Index and Commerce Department readings on housing starts and building permits issued. The National Association of Realtors® will release data on sales of pre-owned homes and weekly readings on mortgage rates and new jobless claims will also be released.

Monday December 16, 2019  NY Fed Mfg Index Dec
Tuesday December 17, 2019  Building Permits Nov
Tuesday December 17, 2019  Housing Starts Nov
Tuesday December 17, 2019  Industrial Production Nov
Tuesday December 17, 2019  Capacity Utilization Nov
Tuesday December 17, 2019  JOLTS Job Openings Oct
Thursday December 19, 2019  Initial Jobless Claims Week of Dec 9
Thursday December 19, 2019  Existing Home Sales Nov
Friday December 20, 2019  GDP final Q3 2019
Friday December 20, 2019  Core PCE Prices final Q3 2019
Friday December 2019 2019  Personal Income Nov
Friday December 20, 2019  Core PCE Price Index Nov
Friday December 20, 2019  U of Mich Consumer Sent. Dec

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.

---