economy

The Week In Review (January 22, 2007) : What To Watch For

January 22, 2007

Last week, economic data showed that the economy continues to grow at a healthy pace and that last year’s fears of an economic recession may have been overblown; wholesale and consumer prices were up 1.1% and 2.5% annually, respectively. With no clear recessionary indicators present in the market, long-term mortgages such as the 30-year fixed […]

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The Irrelevance of The University of Michigan Consumer Sentiment Survey

January 19, 2007

Today’s University of Michigan Consumer Sentiment survey showed that Americans are feeling terrific about the state of the economy.  The index jumped to 98.0 in January from last month’s 91.7 level. On a broader level, this is not an important piece of data for mortgage markets.  The idea is that a more confident consumer will […]

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The Housing Engine That Won’t Slow Down

January 18, 2007

Housing Starts handily beat economists’ expectations this morning and CPI showed strength, too, sustaining the market momentum that has trended mortgage rates higher over the last 30 days. The Federal Open Market Committee has repeatedly told us that it expects the economy to slow down in 2007, led by a weakening housing market.  And yet, […]

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How Cold Weather Can Slow Down the Economy

January 16, 2007

As a big chill settles in over the country, oil prices continue their decline and are now down 15% since mid-July.  High oil prices are typically associated with inflation, but given the precarious balance of the U.S. economy, low oil prices may lead to inflation, too. Americans fuel the economy by spending money on goods […]

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The Week In Review (January 15, 2007) : What To Watch For

January 15, 2007

In a week practically devoid of economic news, mortgage rates trended higher last week amid falling oil prices and surprise strength in Holiday Season spending. Investors are jittery about the U.S. economy.  Since it stopped raising the Fed Funds Rate this past summer, the Federal Reserve has repeatedly told markets that it is expecting an […]

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It Was “Happy Holidays” for Retailers in December

January 12, 2007

For all of the talk about the slowdown in consumer spending, it appears that this Holiday Season was a winner.  This morning’s Retail Sales report doubled economists’ expectations by showing 1.0% growth. This is just one more inflationary pressure in the economy and makes it less likely that the Fed will lower the Fed Funds […]

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Once Bitten, Twice Shy: ADP Says Jobs Were Lost in December

January 10, 2007

After last week’s data showed ongoing strength in the U.S. economy, there is a growing sentiment that the Fed will choose to raise the Fed Funds Rate before it begins lowering it. FFR currently stands at 5.250% and here is what markets are predicting over the near-term: After January 30-31 Meeting: Decrease to 4.750: 0% […]

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How Will Oil’s Plunging Prices Impact Mortgage Rates

January 9, 2007

This summer, oil crossed the $77 threshold per barrel and since then, it has been on a steady decline. Today, it crossed $58 per barrel. Lower prices for oil should reduce heating bills and gas pump receipts for Americans this winter. High oil prices are a stimulus for inflation so on the surface this would […]

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Once Bitten, Twice Shy: ADP Says Jobs Were Lost in December

January 4, 2007

This summer, economists were predicting that 175,000 new jobs were created in June and then payroll processor ADP shared their own estimate of 368,000 with the markets. In a panic, mortgage rates moved higher because – well, what if ADP was right?!? The actual figure turned out to be 121,000. That major miss jolted the […]

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New Homes Sales Is Less Important Than New Homes Closed

December 28, 2006

Yesterday’s New Home Sales report revealed the following signs of immense strength in the housing sector and mortgage rates are moving higher on the news. Sales registered 1.047 million versus the expectation of 1.015 million — a difference of 3.15%. Sales were revised higher by 46,000 over the past three months. Inventory levels dropped to […]

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It’s not the House that matters, it’s the Stuff you buy for the House that Does

December 27, 2006

With many traders on vacation this week, the impact of economic reports on mortgage rates will be amplified. Specifically, be wary of this week’s New Home Sales and Existing Homes Sales reports. Since July, the Fed has repeatedly told us that housing will lead to an economic slowdown. As a result, markets have placed housing […]

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It’s Not The House That Matters, It’s The Stuff You Buy For The House That Does

December 26, 2006

With many traders on vacation this week, the impact of economic reports on mortgage rates will be amplified. Specifically, be wary of this week’s New Home Sales and Existing Homes Sales reports. Since July, the Fed has repeatedly told us that housing will lead to an economic slowdown. As a result, markets have placed housing […]

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