The Latest Forecast: Mortgage Rate Projections for the Coming Week – July 17, 2023
Last week’s economic reporting provided insights into key indicators such as inflation and consumer sentiment. Here are the key findings:
Month-to-Month Inflation Rises as Year-Over-Year Inflation Slows
The Consumer Price Index (CPI) for June showed a 0.20 percent increase compared to May’s growth of 0.10 percent, falling short of the expected 0.30 percent month-to-month growth. Excluding the volatile food and fuel sectors, the core CPI reading experienced a decrease in June, with a growth rate of 0.20 percent compared to May’s 0.40 percent.
In terms of year-over-year inflation, June’s reading reflected a slowdown, with a growth rate of 3.00 percent compared to May’s 4.00 percent. Analysts had anticipated a reading of 3.10 percent year-over-year growth. For the Core Consumer Price Index, the year-over-year growth rate was 4.80 percent, slightly below analysts’ expected inflationary growth of 5.00 percent. In May, the year-over-year inflation reading was 5.30 percent. Year-over-year readings provide a broader perspective on inflation trends, eliminating month-to-month volatility.
Consumer Sentiment Remains Strong
Despite rising interest rates, consumer enthusiasm remained robust. The preliminary Consumer Sentiment Index for July reached its highest level since September 2021, with a reading of 72.60. Analysts had expected a reading of 65.50, compared to June’s reading of 64.40. The Consumer Sentiment Index provides valuable insights into consumer attitudes and confidence levels.
Mortgage Rates Approach 7 Percent
Freddie Mac’s weekly Primary Mortgage Market Survey revealed that average mortgage rates increased, edging closer to 7.00 percent for 30-year fixed-rate mortgages. The average rate for 30-year fixed-rate mortgages rose by 15 basis points to 6.96 percent, while the average rate for 15-year fixed-rate mortgages increased by six basis points to 6.30 percent. The upcoming July 13 jobless claims report is expected to provide further information on employment trends.
Upcoming Economic Outlook
Looking ahead, this week’s economic reporting will include several significant updates. Here are the anticipated highlights:
– Home builder confidence in single-family housing market conditions
– Government reports on housing starts and retail sales
– The National Association of Realtors® monthly report on sales of previously-owned homes
– Weekly readings on mortgage rates and jobless claims will also be published.
These reports will provide valuable insights into the housing market, retail sector, and employment trends.
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