07
Mar
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – March 7, 2022

What's Ahead For Mortgage Rates This Week - March 7, 2022Last week’s economic reporting included readings on construction spending, written testimony from Fed chair Jerome Powell and data on public and private sector jobs and national unemployment. Weekly readings on mortgage rates and jobless claims were also released.

Fed Chair Hints at Rate Hikes in Written Testimony

Federal Reserve Chairman Jerome Powell indicated that consistent rate hikes of the Fed’s target interest rate range will likely occur throughout this year, but he said that the Fed would proceed carefully. Analysts interpreted Mr. Powell’s remarks to mean that he would limit each rate hike to 0.25 percent but could be higher depending on the pace of inflation.

Inflation rose by 7.50 percent year-over-year in January; this was the highest inflation rate since 1982. Chairman Powell said the Fed wanted to prevent persistent high inflation while promoting sustainable economic expansion and a strong labor market. The war in Ukraine could lead to faster inflation as Russia is the world’s second-largest producer of oil.

Mortgage Rates, Fall, Jobless Claims Mixed

Freddie Mac reported lower average mortgage rates last week as the rate for 30-year fixed-rate mortgages fell by 13 basis points to 3.76 percent. Rates for 15-year fixed-rate mortgages were also 13 basis points lower at 3.01 percent and rates for 5/1 adjustable-rate mortgages averaged 2.91 percent and were seven basis points lower on average. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable-rate mortgages.

Initial jobless claims fell last week with 215,000 new claims filed as compared to 233,000 jobless claims filed in the previous week. 1.48 million continuing jobless claims were filed last week as compared to the prior week’s reading of 1.47 million continuing claims filed.

Jobs Data Shows Mixed Results

Public and private sector jobs data and the national unemployment rate reflected a strong labor market. The government’s Non-Farm Payrolls report tracks public and private-sector job growth and reported 678,000 jobs were added in February as compared to expectations of 440,000 jobs added and January’s reading of 481,000 jobs added.

The ADP jobs report includes only private-sector jobs data; 475,000 jobs were added in February as compared to predictions of 400,000 jobs added and January’s reading of 509,000 private-sector jobs added. The national unemployment rate dropped to 3.80 percent; analysts expected an unemployment rate of 3.90 percent and January’s jobless rate of 4.00 percent.

What’s Ahead

This week’s scheduled economic reporting includes readings on job openings and quits, inflation, and the University of Michigan’s preliminary reading on consumer sentiment. Weekly reports on mortgage rates and jobless claims will also be released.

14
Feb
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – February 14, 2022

What's Ahead For Mortgage Rates This Week - February 14, 2022Last week’s economic reporting included readings on inflation and the University of Michigan’s preliminary February reporting on consumer sentiment. Weekly readings on mortgage rates and jobless claims were also released.

Inflation Rises as Fed Considers Raising Key Rate

The government’s Consumer Price Index for January reported that month-to-month inflation rose by 0.60 percent as compared to an expected increase of 0.40 percent which was based on December’s month-to-month increase of 0.50 percent.  Year-over-year inflation rose to a rate of 7.50 percent, which was the highest inflation rate in 40 years. Core inflation, which excludes volatile food and energy sectors, also rose 0.60 percent in January from December’s reading of 5.50 percent.

Analysts said that the Federal Reserve will likely raise its key federal funds rate range to help slow inflation, but drastic dips in the inflation rate aren’t expected. While the Fed predicted inflation to ease in a statement made last December, inflation has only increased. The Fed’s strategy of raising interest rates would ease high consumer demand and help slow rapidly rising prices for housing, goods, and services.

Mortgage Rates Rise, Jobless Claims and Consumer Sentiment Fall

Freddie Mac reported higher mortgage rates last week as the average rate for 30-year fixed-rate mortgages rose by 14 basis points to 3.69 percent. The average rate for 15-year fixed-rate mortgages rose by 16 basis points to 2.93 percent. Rates for 5/1 adjustable-rate mortgages averaged 2.80 percent and nine basis points higher. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for  5/1 adjustable-rate mortgages.

223,000 new jobless claims were filed last week as compared to the prior week’s reading of 239,000 first-time claims filed. No information for continuing jobless claims was released last week.

The University of Michigan reported a preliminary index reading of 61.7 for January’s Consumer Sentiment Index. This was the lowest consumer sentiment reading in ten years and was attributed to consumer concerns over rising inflation.

What’s Ahead

This week’s scheduled economic news includes readings from the National Association of Home Builders on housing market conditions, Commerce Department readings on building permits issued, and housing starts. Data on sales of pre-owned homes will be released along with weekly reporting on mortgage rates and jobless claims.

07
Feb
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – February 7, 2022

What's Ahead For Mortgage Rates This Week - February 7, 2022

Last week’s economic reports included readings on construction spending and labor-related reports on jobs and the national unemployment rate. Weekly data on mortgage rates and jobless claims were also published.

Residential Con

The Commerce Department reported overall construction spending rose by 1.30 percent in January, which was the largest increase since April of last year. Private residential construction spending fell by 0.30 percent in January; this was the sixth consecutive month for declining private-sector residential construction spending.

Construction Spending Falls in January

Analysts cited costly building materials, fewer available options for prospective buyers, and higher mortgage rates as factors contributing to less construction spending. Homebuying traditionally slows during the winter months.

Mortgage Rates Little Changed, Jobless Claims Fall

Freddie Mac reported little change in average mortgage rates last week as the rate for 30-year fixed-rate mortgages remained unchanged at 3.55 percent. Rates for 15-year fixed-rate mortgages averaged 2.77 percent and three basis points lower than for the previous week. The average rate for 5/1 adjustable rate mortgages rose one basis point to 2.71 percent on average. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages, 0.70 percent for 15-year fixed-rate mortgages, and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims were lower last week with 238,000 first-time claims filed as compared to the prior week’s reading of 261,000 first-time claims filed. Analysts predicted 245,000 new claims would be filed. Continuing jobless claims were also lower with 1.63 million ongoing claims filed as compared to the prior week’s reading of 1.67 million continuing jobless claims filed.

Labor Reports Show Slower Jobs Growth, Unemployment Rate Ticks Up

ADP Payrolls reported 301,000 fewer private-sector jobs open in January as compared to 776,000 private-sector jobs available in December. Analysts expected 200,000 private-sector job openings in January. The government’s Non-Farm Payrolls report showed 467,000 jobs added in January as compared to the expected reading of 150,000 jobs added and December’s reading of 510,000 public and private-sector jobs added. Hiring in December was higher than expected as analysts predicted less hiring due to the ongoing spread of the omicron variant of COVID-19.

The national unemployment rate rose to 4.00 percent in January as compared to December’s reading of 3.90 percent. Analysts predicted national unemployment to hold steady at 3.90 percent.  

What’s Ahead

This week’s scheduled economic reports include readings on inflation and consumer sentiment along with weekly data on mortgage rates and jobless claims.