Thursday – February 3, 2022
After four weeks of increases, mortgage rates are unchanged this week and hover to near levels seen in late March of 2020, though they remain historically low. Freddie Mac reports that the 30-year fixed-rate mortgage rose held at 3.55% with 0.8 in points and fees. The record low was 2.65% on January 7, 2021. Sam Khater, Freddie Mac’s chief economist said, “As the economic recovery continues going into the spring and summer, mortgage rates are expected to resume their upward trajectory. In the meantime, recent data suggests that homebuyer demand continues to be elevated as supply remains low, driving higher home prices.”
First-time unemployment claims continued to remain low in the latest week as the country continues to get back to normal as the pandemic subsides. At present, there are nearly 11 million jobs available across the nation. The Labor Department reports that Weekly Initial Jobless Claims fell to 238,000 from 261,000 for the week ended January 28, 2022. Continuing claims, or those receiving benefits for at least two weeks straight, fell to 1.628 million from 1.672 million.
The Jobs Report for January will be released tomorrow at 8:30 a.m. ET. Expectations are calling for a gain of 150,000 after the weak 211,000 created in December for Non-Farm Payrolls. ADP Private Payrolls for January were minus 301,000 with expectations at +207,000. Estimates are all over the map with a high of +385,000 to a low of -400,000. The data will be closely scrutinized by both investors and the Federal Reserve.
Courtesy of Mortgage Market Guide
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Tuesday – February 1, 2022
Economic activity in the manufacturing sector rose last month as the overall economy has now risen 20 months in a row. The ISM Index for January declined to 57.6 from 58.8 in December and was inline with expectations. A reading above 50 signals that the manufacturing economy is generally expanding; below 50, contracting. The prices paid component, an inflationary measure, surged while the employment indicator inched higher. Spokesperson Timothy R. Fiore said, “The U.S. manufacturing sector remains in a demand-driven, supply chain-constrained environment, but January was the third straight month with indications of improvements in labor resources and supplier delivery performance.
Redfin reports that 34.1% of U.S. single-family homes for sale in December were new construction, up from 25.4% a year earlier and the highest share on record. Builders cite soaring demand due in part to historically low mortgage rates, scarce inventories and the work from home environment. Inventories have plagued the sector for existing homes down 14% from December 2020 to December 2021. At the same time, new home construction jumped 34% to a normal six-month supply.
Oil prices continue to increase this week which has pushed gasoline prices at the pumps higher across the nation. Tensions in Eastern Europe has increased the price for a barrel of oil to near $90. That in turn has fueled gas prices to rise to $3.37 for a regular gallon of gasoline, up from $3.28 a month ago and up from $2.42 a year ago. The highest record price was $4.11 hit back on July 17, 2008. If tensions ease in Ukraine, prices could inch lower in the short-term but will resume their ascent once the spring and summer driving season is upon us and as refineries switch back to more expensive summer gas.
Courtesy of Mortgage Market Guide
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