In this week’s economic review, the 30-year average mortgage rate increased, payroll growth surpassed expectations, and credit spending slowed.
February nonfarm payrolls grew an outsized 313,000, over 80,000 over Econoday’s high-end estimate, on top of upwardly-revised January and December readings.
By sector, construction is the standout, adding 61,000 jobs in the month for the fourth back-to-back gain over 40,000. The manufacturing sector was up 31,000 and retail and professional and business sectors were both up 50,000.
Despite growth, average hourly earnings came in below expectations, up just 0.1 percent. This dropped the year-over-year gains from +2.8% to +2.6%.
The unemployment rate held steady at a very low 4.1 percent.
January consumer credit growth slowed, increasing $13.9 billion in the month. The gain was the smallest reading since September 2017 with both December and November reports revised higher.
The slowing growth is attributed to a drastic drop in revolving credit which increased just 0.8% after a gain of 7.2% in December. January’s revolving credit gain is the smallest in nearly three years. Non-revolving credit, typically student and auto loans, rose 5.6% in January.
This week in the economy:
- As of March 8th, the 30-year average fixed rate was 4.46% with 0.5 points, according to Freddie Mac.
- In the week of March 2nd, the purchase sector of mortgage applications fell a seasonally adjusted 1 percent. Unadjusted, purchase applications are up just one percent year-over-year. The refinance sector jumped 2.0 percent from the previous week, but the refinancing share of mortgage activity remains unchanged at 41.8 percent.
- In the week of March 3rd, initial jobless claims jumped 21,000 to 231,000. The increase pushed the 4-week average up 2,000 to 222,500, but the average is still several thousand below the month-ago comparison.
- The Bloomberg Consumer Comfort Index increased 0.6 points to 56.8, just shy of another new expansion high.
The economic calendar for the week of March 12th, 2018:
- Tuesday – Consumer Price Index
- Wednesday – MBA Mortgage Applications, Retail Sales
- Thursday – Jobless Claims, Bloomberg Consumer Comfort Index, Housing Market Index
- Friday – Housing Starts, JOLTS, Consumer Sentiment
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