This week’s biggest economic news stories centered on mortgage rates and job openings and hiring. Mortgage rates experienced their first decline last week after a 9-week climb and fell yet again this week.
The Job Openings and Labor Turnover Survey remained strong for the month of November with 5.5 million job openings and a hiring trend of 5.2 million. The gap between job openings and the hiring rate signals that employers are having a hard time finding the right applicants with the right skill sets for their open positions.
Post-election, consumer sentiment has increased more than 10 points, according to Bloomberg. The consumer sentiment report continues to hold near the cycle high but the preliminary January index dipped 0.1 points from December. The current conditions component increased 0.6 points while the expectations component eased by 0.4 points.
The retail sales report was mixed for December despite reports of strong consumer confidence and rising daily spending. While the index did post a respectable 0.6 percent gain, without the auto component, the index only increased by 0.2 percent. Less autos and gasoline, the index remained flat. Surprising for the holiday season, department store, electronic and appliance sales fell while vehicle sales jumped 2.4 percent.
This week in the economy:
- The 30-year fixed-rate averaged 4.12 percent (down 0.8 percent) with 0.5 points as of January 12, according to Freddie Mac.
- Purchase applications increased a seasonally adjusted 6.0 percent in the week of January 6, according to MBA Mortgage Applications. Refinance applications also saw an uptick, up a seasonally adjusted 4 percent. Year-over-year, purchase applications are down 18 percent.
- Initial jobless claims remained low in the January 7 week, hitting 247,000, which is only 4,000 higher than the cycle low, according to Bloomberg.
- The Labor Market Conditions Index, which is compiled by the Federal Reserve to track labor market activity, had its first negative scoring since May 2016 at minus 0.3.
What’s on economic calendar for the week of January 16, 2017:
- Wednesday – MBA Mortgage Applications, Consumer Price Index, Housing Market Index
- Thursday – Jobless Claims, Bloomberg Consumer Comfort Index, Housing Starts
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