Weekly Economic Review: Consumer Confidence Hits 15-Year High, Pending Home Sales Stumble

Posted by Laine Smith on 12/30/16 9:00 AM

Topics: Economy

This week in economic news mortgage rates continued their climb for the ninth straight week, according to HousingWire, consumer confidence continued strengthening and pending home sales felt the squeeze of rising mortgage rates.

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Image courtesy of hywards at FreeDigitalPhotos.net

Pending home sales were expected to rise a healthy 0.3 to 2.0 percent in November, but rising mortgage rates sent the index into a tumble. Overall, the index fell 2.5 percent in November with three of four regions posting declines.

Consumer strength has been evident for the last few months with the December Consumer Confidence report showing even further gains. The index jumped to a level of 113.7 this month, which is the highest reading since August 2001, according to Bloomberg.

While the current conditions component dipped to 126.1 from November’s 132.0, the expectations component paved the way for the December report’s strength, up 11.1 points to 113.7. Consumers reported increasing expectations of more jobs in the months ahead with that component jumping 4.9 points.

This week in the economy:

  • The 30-year fixed-rate averaged 4.32 percent with 0.5 points in the December 29 week, according to Freddie Mac.
  • Initial jobless claims fell 10,000 to 265,000 after an especially large spike the week prior. The 4-week average is down by 750 to 263,000.
  • The Bloomberg Consumer Comfort Index eased 0.7 points in the December 25 week after hitting a large jump of 1.2 points the prior week.

What’s on economic calendar for the week of January 2, 2017:

  • Wednesday – MBA Mortgage Applications, ADP Employment Report, Gallup U.S. Job Creation Index, Gallup US Consumer Spending Measure, FOMC Minutes
  • Thursday – Jobless Claims, Bloomberg Consumer Comfort Index
  • Friday – Employment Situation

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