Quick Hit on Economic & Mortgage Picture for Week of 09/15/2014

The economy still seems to be stuck in low gear, we are moving forward albeit at a painstakingly slow pace. Mortgage applications have been down, which is never a good sign for the housing recovery which needs to drive the recovery.

Here is a quick update from our partner NYCB with news that may move mortgage rates:

In the aftermath of the back-to-school shopping rush, Retail Sales for the month of August posted a 0.6 percent increase, just in line with analysts’ expectations. July sales were also revised upwards, from flat to 0.3 percent growth. Consumer Sentiment is climbing this month, as compared to August, while Business Inventories growth remains steady at 0.4 percent, in line with expectations.

According to Freddie Mac, the average mortgage interest rates were 4.12 percent for the 30 year Fixed rate term and 3.26 percent for the 15 year Fixed rate term, as compared to 4.10 percent and 3.24 percent, correspondingly, last week. As can be seen, interest rates inched up slightly again, after three flat weeks.

The next FOMC meeting this week, followed by an official announcement on Wednesday, may introduce some new factors and change the current interest rates trend. The Housing Market Index will be reported earlier on the same day and Housing Starts, a leading indicator of the housing market conditions, is being released on Thursday. Two other categories of significant economic readings are scheduled for release this week: inflation data – the Producer Price Index on Tuesday and Consumer Price Index on Wednesday, and Manufacturing data (Empire State Manufacturing Survey) along with Industrial Production on Monday, and Philadelphia Fed Survey on Thursday.

 

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