In this week’s economic review, the average fixed mortgage rate increased, retail sales rebounded, and housing starts posted a strong month for multi-family units.
The headline level of retail sales surpassed expectations with a 0.6 percent gain in March. The core reading (retail sales minus autos and gas) posted a smaller yet respectable gain of 0.3 percent. The auto sales component was March’s stunner with a 2.0 percent jump following a long lull.
Declines were centered in departments stores, down 0.3 percent, and closing stores, down 0.8 percent. Building materials and sporting goods also posted descents.
On top of auto sales, the positives of the report included a second straight monthly gain for restaurants (0.4 percent) and furniture stores (0.7 percent).
Residential construction hit a stride in March with housing starts blowing past high-end estimates at a 1.319 million annualized rate. Permits were respectable, as well, at an annualized rate of 1.354 million.
Multi-family unit starts boomed 14.4 percent in the month to a 452,000 rate and permits grew 19.0 percent higher to 514,000. On the other hand, single-family units were soft with starts falling 3.7 percent and permits down 5.5 percent. The declines are mostly a result of February’s large upward revisions.
The downside of the report is the completion rate, which slowed by 5.1 percent to 1.217 million.
This week in the economy:
- As of April 19th, the 30-year average fixed rate was 4.47% with 0.5 points, according to Freddie Mac.
- In the week of April 13, the purchase sector of mortgage applications rose a seasonally adjusted 6 percent, pulling the unadjusted purchase index up 10 percent higher than the same week a year ago. Refinance applications increased 4 percent in the week but the increase failed to revive the refinance share of mortgage activity, which remains at its lowest level since September 2008.
- In the week of April 14th, initial jobless claims fell 1,000 to a seasonally adjusted level of 232,000.
- The Bloomberg Consumer Comfort Index saw little change in the week of April 19 with a 0.1 point increase. This brings the index to a level of 58.1.
The economic calendar for the week of April 23rd, 2018:
- Monday – Existing Home Sales
- Tuesday – New Home Sales, S&P Corelogic Case-Shiller HPI, Consumer Confidence, FHFA House Price Index
- Wednesday – MBA Mortgage Applications
- Thursday – GDP, Consumer Sentiment
To receive updates on mortgage rates and other economic news, sign up for our weekly economic updates.