This week’s economic reports centered on consumers and new home construction. Mortgage rates ended the week higher and not far from where they were a year ago.
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Consumerism has picked up steam this fall. According to the October Retail Sales report, retail sales jumped 0.8 percent overall in October. Auto sales increased by 1.1 percent for the month on top of September’s 1.9 percent increase.
Home builder optimism remained high this month with the November Housing Market Index holding steady at 63. The current and future sales components are at 69, but lack of traffic, which is at a 47, continues to hold down the index overall.
Housing starts surged nearly 26 percent in October to an annualized rate of 1.323 million, hitting the best rate since August 2007 and the strongest monthly percentage since 1982. Single-family homes paved the way with a 10.7 percent increase following September’s 8.4 percent jump.
This week in the economy:
- The 30-year fixed-rate average swelled again this week, hitting 3.94%, according to Freddie Mac.
- October’s headline Consumer Price Index (CPI) increased by 0.4 percent, reflecting a 3.5 percent jump in spiking energy prices. CPI minus food and energy increased 0.1 percent from a month ago.
- In the November 16 week, purchase applications fell a seasonally adjusted 6 percent, according to MBA Mortgage Applications. The drop is attributed to the recent sharp increase in mortgage rates. Refinancing applications took a larger hit, falling 11 percent from the previous week. With the substantial drop, purchase applications are up only 3 percent year-over-year.
- Jobless claims fell sharply in the November 12 week, down 19,000 to a lower-than-expected 235,000. The November 12 week serves as the sample week for the Employment Report.
- The Bloomberg Consumer Comfort Index increased slightly to 45.5 in the November 13 week.
What’s on economic calendar for the week of November 21, 2016:
- Tuesday – Existing Home Sales
- Wednesday – MBA Mortgage Applications, FHFA House Price Index, New Home Sales, Bloomberg Consumer Comfort Index, FOMC Minutes, Jobless Claims, Consumer Sentiment
- Thursday – Markets Closed (Thanksgiving)
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