Federal Reserve Rate Decision
The most significant and influential financial data currently making waves is, as always, the Federal Reserve rate decision. This time, it aligns closely with the expectations of the broader market and lending partners. The Federal Reserve continues to hold its current standing and is displaying resistance to potential rate cuts slated for March in the next rate decision.
Most of the economic indicators from the past year and this month have further fueled speculation that the Federal Reserve has largely achieved its goals, hinting at strong resistance to pending rate cuts.
Other Notable Rates
Among other notable rates, the ISM manufacturing numbers have fallen in line, indicating growth at the beginning of the year. Additionally, consumer sentiment has surged to its highest levels in the last two and a half years.
Federal Rate Decision Insights
In the ongoing effort to maintain current rates, the Federal Reserve has expressed its views on the March timeline for any potential rate reductions. During the press conference on Wednesday afternoon, Powell remarked, “Based on the meeting today, I would tell you that I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting to identify March as the time for its first rate cut, but that’s to be seen.”
Consumer Sentiment Soars
Consumer sentiment has witnessed a substantial rise in January, reaching its highest level since the summer of 2021. This increase comes as Americans find relief from declining inflation and witness improvements in the economy. The final reading of the sentiment survey climbed to 79.0 from a preliminary 78.8 earlier in the month and from 69.7 in December, as reported by the University of Michigan. This marks the highest level since July 2021.
PMI / ISM Factory Index
The closely watched index measuring U.S. manufacturing activity has risen to 49.1% in January from 47.1% in the previous month, according to the Institute for Supply Management. This level represents the highest reading since October.
Primary Mortgage Market Survey Index
- 15-Year Fixed-Rate Mortgages (FRM) have decreased by -0.02%, with the current rate at 5.94%.
- 30-Year FRM rates have seen a decrease of -0.06%, with the current rate at 6.63%.
MND Rate Index
- 30-Year FHA rates are experiencing a -0.02% increase for this week, with current rates at 6.18%.
- 30-Year VA rates are seeing a -0.03% increase for this week, with current rates at 6.22%.
Jobless Claims Report
Initial jobless claims have been reported at 224,000, compared to the expected claims of 214,000, with the prior week recording 215,000 claims.
What Lies Ahead
Looking ahead, it will be an exceptionally light week following the Federal Reserve rate decision, with nothing noteworthy except the usual unemployment numbers. The subsequent week will mark the first release of inflation figures following the Consumer Price Index data.
