Last week’s economic news included readings on inflation, core inflation and consumer sentiment. Weekly reports on mortgage rates and first-time jobless claims were also released.
Lower Gas Prices Dampen August Inflation Rate
Consumer prices fell in August; analysts attributed the decline to lower gasoline prices. August’s reading matched expectations, but was 0.20 percent lower than July’s reading. The Core Consumer Price Index, which excludes volatile food and fuel sectors, rose by 0.30 percent and matched July’s reading.
Analysts expected an August core inflation reading of 0.20 percent. Rising housing and healthcare costs indicated that overall inflation would rise in coming months. Core inflation rose to its highest level in 13 months and was 2.40 percent higher year-over-year.
Mortgage Rates, Rise; New Jobless Claims Fall
Freddie Mac reported higher mortgage rates last week. Rates for 30-year fixed rate mortgages averaged 3.56 percent and were two basis points higher than in the prior week. Rates for 15-year fixed rate mortgages averaged 3.09 percent and were nine basis points higher on average.
Rates for 5/1 adjustable rate rose six basis points to an average rate of 3.36 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.
New jobless claims fell last week with 204,000 first-time claims filed. Analysts expected 213,000 new claims filed based on the prior week’s reading of 219,000 initial claims.
The University of Michigan reported a jump in consumer sentiment in September; August readings fell due to consumer concerns over the impact of tariffs on imported goods. September’s consumer sentiment index reading rose to 92.00 as compared to August’s index reading of 89.80.
Analysts predicted a September index reading of 91.40. Analysts said that while confidence in general economic conditions rose, consumers continued to be worried about the effects of tariffs.
This week’s scheduled economic news includes the National Association of Home Builders Housing Market Index, Commerce Department readings on housing starts and building permits issued and a statement by the Fed’s Federal Open Market Committee statement.
Fed Chair Jerome Powell will also give a press conference. Sales of pre-owned homes will be reported along with weekly readings on mortgage rates and new jobless claims.Share
About the Author:Babak Moghaddam graduated from University of Southern California in 1985. He entered the mortgage industry as a compliance auditor at the Bank of New York in 1986 and completed his masters in Business Administration two years later. After seventeen years in the traditional mortgage banking world Babak finally transformed this vision into his own practice in 2002 when he formed Charter Pacific Lending Corp, a mortgage company that has provided over $900 Million in residential real estate loans throughout Southern California. Babak and his team do things a little differently than other mortgage providers. They work as financial advisors, because they have come to realize that a mortgage is a very powerful financial tool. And just like any other financial tool, it should be managed as part of the overall financial management plan to reach every home owner’s long and short-term financial goals much faster. You can contact Babak for a free consultation and strategy session at (800) 322-1217 X103.