30
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 30, 2023

What's Ahead For Mortgage Rates This Week - January 30, 2023Last week’s economic reporting included readings on new and pending home sales, inflation, and consumer sentiment. Weekly readings on mortgage rates and jobless claims were also released.

New home sales increase in December

The Commerce Department reported new home sales rose to a seasonally-adjusted annual pace of 616,000 sales in December as compared to the expected pace of 615,000  new homes sales and November’s revised reading of 602,000 annual sales. December was the third consecutive month that the pace of new home sales rose, but new home sales remained well below the 1.04 million sales peak reported in August 2020.

Pending home sales rose by 2.5 percent in December, which outpaced expectations of a one percent decrease in pending sales and November’s seasonally-adjusted annual decrease of  -2.6 percent in pending home sales. New home sales are 26.6 percent lower than they were one year ago.

Month-to-month inflation slows in December

The Commerce Department reported that month-to-month inflation rose by 0.1 percent in  December, which matched November’s month-to-month reading. Core inflation rose by 0.1 percent in December to 0.3 percent and matched analyst expectations. Core inflation readings exclude volatile food and fuel sectors that comprise major expenses for many U.S. households.

Year-over-year inflation rose by 5.0 percent in December as compared to November’s pace of 5.5 percent. Core inflation rose  4.4 percent in December, which matched analyst expectations, but fell short of November’s year-over-year reading of 4.7 percent for core inflation.

Mortgage rates, initial jobless claims fall

Freddie Mac reported lower average mortgage rates last week as the rate for 30-year fixed-rate mortgages fell by two basis points to 6.13 percent. The average rate for 15-year fixed-rate mortgages fell by 11 basis points to 5.17 percent.

First-time jobless claims fell to 186,000 filings as compared to the expected reading of 205,000 initial jobless claims and the previous week’s reading of 192,000 new jobless claims filed. Continuing jobless claims rose to 1.68 million ongoing claims as compared to the previous week’s reading of 1.66 million continuing jobless claims filed.

Consumer sentiment strengthens in January

The University of Michigan’s Consumer Sentiment Index rose to an index reading of 64.9 in January, which surpassed the expected reading of 64.6 and December’s final index reading of 64.6. Readings over 50 indicate that a majority of consumers surveyed have a positive outlook on the economy. Falling gasoline prices contributed to an improved consumer outlook, but grocery prices remained high.

What’s ahead

This week’s scheduled economic reporting includes readings on U.S. home prices, The Federal Reserve’s Federal Open Market Committee meeting, and Fed Chair Jerome Powell’s scheduled press conference. Labor-sector reports on job growth and the national unemployment rate will also be released.

23
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 23, 2023

What's Ahead For Mortgage Rates This Week - January 23, 2023

Last week’s economic reporting included readings from the National Association of Home Builders on U.S. housing markets, and Commerce Department data on housing starts and building permits issued. The National Association of Realtors® reported sales of previously owned homes, and weekly readings on mortgage rates and jobless claims were also released.

NAHB: Homebuilder Sentiment Rises in December

The National Association of Home Builders reported increased homebuilder confidence in U.S. housing market conditions in December; this was the first time in 12 months that homebuilder confidence rose. Builder confidence in current housing market conditions rose by four points; builder confidence in home sales conditions over the next six months increased by two points. Builder confidence in prospective buyer traffic in new housing developments rose by three points.

Jerry Konter, a Georgia home builder and chairman of NAHB, said: “It appears that the low point for building sent in this cycle was registered in December, even as many builders continue to use a variety of incentives including price reductions to bolster sales.  The rise in builder sentiment also means that cycle lows for permits and starts are likely near, and a rebound for homebuilding could be underway later in 2023.”

Robert Dietz, the NAHB’s chief economist, predicted that single-family home building will increase as mortgage rates are expected to trend lower and boost housing affordability. Mr. Dietz said, “Improved housing affordability will increase housing demand as the nation grapples with a structural housing deficit of 1.5 million units.”

Mortgage Rates, New Jobless Claims Fall

Freddie Mac reported lower mortgage rates last week as the average rate for 30-year fixed-rate mortgages fell by 18 basis points to 6.15 percent. Rates for 15-year fixed-rate mortgages averaged 5.28 percent and were 24 basis points lower on average.

First-time jobless claims fell to 190,000 claims filed as compared to expectations of 215,000 initial claims filed and the previous week’s reading of 205,000 new jobless claims filed. Ongoing jobless claims increased to 1.65 million claims filed compared to the previous week’s reading of 1.63 million continuing jobless claims.

What’s Ahead

This week’s scheduled economic reporting includes readings on new and pending home sales, consumer sentiment, and predictions on inflation. Weekly readings on mortgage rates and jobless claims will also be published. 

17
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 17, 2023

What's Ahead For Mortgage Rates This Week - January 17, 2023

Last week’s financial reporting was dominated by readings on inflation. Weekly reports on mortgage rates and jobless claims were also released and Treasury Secretary Janet Yellen cautioned lawmakers that the debt ceiling must be raised or eliminated.

Inflation slows in December

Month-to-month inflation slowed by -0.1 percent in December and matched analysts’ expectations. This was the first slowing of inflation since the pandemic and the highest inflation reading since inflation reached its highest level in 40 years. Inflation rose by 0.1 percent in November. Year-over-year inflation rose by 6.5 percent, which matched expectations, and fell short of the November reading of 7.1 percent inflation.

Consumer prices fell for the sixth consecutive month in December. Core inflation, which excludes volatile food and fuel sectors, rose by 0.3 percent in December and matched analysts’ expectations. Slowing inflation is expected, but the  Federal Reserve has signaled its intention to continue raising its target interest rate range.

The University of Michigan projected that inflation will rise by 4.00 percent year-over-year in January as compared to December’s reading of 4.4 percent and the 40-year peak rate of  9.1 percent posted last summer.

Treasury Secretary: U.S. debt limit is looming

Treasury Secretary Janet Yellen announced that the U.S. debt ceiling is approaching and encouraged lawmakers to either raise or eliminate the debt ceiling to avoid the U.S. defaulting on its obligations. Ms. Yellen wrote in a letter to U.S. lawmakers, “While Treasury is not currently able to estimate how long extraordinary measures will enable us to continue to pay the government’s obligations, it’s unlikely that cash and extraordinary measures would be exhausted before early June.”

Ms. Yellen emphasized that increasing or removing the debt ceiling would not result in additional spending, but would allow the government to continue financing existing obligations made by lawmakers and Presidents of both parties. Secretary Yellen cautioned that failure to address the debt ceiling would “cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability.”

Mortgage Rates, Jobless Claims

Freddie Mac reported lower mortgage rates last week as the average rate for 30-year fixed-rate mortgages fell by 15 basis points to 6.33 percent. The average rate for 15-year fixed-rate mortgages fell by 21 basis points to 5.52 percent.

205,000 new jobless claims were filed last week, which fell short of projections for 210,000 initial claims filed and the previous week’s reading of 206,000 first-time claims filed. 1.63 million continuing jobless claims were filed as compared to the previous week’s reading of 1.70 million ongoing claims filed.

What’s Ahead

This week’s scheduled economic reports include readings from the National Association of Home Builders on housing markets, readings on housing starts, and building permits issued.