Major reports were weaker than expected last week. While disappointing for the economy, it was good news for mortgage rates which ended the week slightly lower.
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Uncertainty about the timing of the first federal rate hike is causing Fed officials' comments to have significant impact on mortgage rates, which increased during Fed Vice Chair Fischer's speech on Thursday but recovered by the end of the Fed's session. This buoyancy is expected to continue in the upcoming weeks.
After three weeks of impressive gains, the purchase index fell back last week, though it is still up a solid 7 percent year-over-year, an indication of strength for the spring housing market.
Initial Jobless Claims increased last week, but the 4-week average saw little change and is still 25,000 below the month-ago comparison. This is a positive indication of improvement in the April employment market.
Last week in the economy:
- The S&P 500 started the week at 2,102, dropping 1.14% and ended the week at 2,081.
- Mortgage rates (the national average) fell 0.03% (3 basis points).
- The market consensus for Retail Sales in March was a 1.1% boost, possibly indicating the fade of poor weather affecting consumerism.
- The purchase index of MBA Mortgage Applications slipped 3% in the week of April 10, as the refinance index fell for a second week.
- The Housing Market index was up 4 points to 56 in April vs. a revised 52 in March.
- Housing Starts are still slow but saw a slight rebound in March after plunging 14.5% in February.
- Initial Jobless Claims increased last week by 12,000.
- The Consumer Price Index saw a small month-over-month change of 0.2% and was stagnant year-over-year.
What's on the economic calendar for the week of April 20, 2015:
- Wednesday: MBA Mortgage Applications and Existing Home Sales will be released.
- Thursday: Jobless Claims, New Home Sales and Money Supply will be updated.
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