Major inflation reports are scheduled for the coming week, including both the Consumer Price Index (CPI) and Producer Price Index (PPI). Based on recent data from the Personal Consumption Expenditures (PCE) Index and GDP estimates, the inflation data is expected to align with forecasts. The Federal Reserve has maintained a cautious (hawkish) stance, with expectations that current interest rates will stay steady following the recent rate decision. However, inflation is now nearing the Fed’s target rate, and the prospect of a ‘soft landing’ for the economy appears within reach. This optimistic outlook suggests potential rate cuts may be on the horizon.
Federal Reserve Rate Decision
In the face of slowing inflation and strong consumer spending, the Federal Reserve announced that it will keep the interest rate steady, holding the benchmark borrowing rate to a range of 5.2% to 5.5%.
Consumer Credit
By the numbers: U.S. consumer borrowing in September rose by only 1.4%, with most of the increase attributed to student loans, as Americans reduced their use of credit cards. Consumer credit rose by $6.0 billion in September, according to Federal Reserve data. Economists had forecasted a larger increase of $13 billion, based on a Wall Street Journal survey.
Primary Mortgage Market Survey Index
• 15-Yr FRM rates are seeing an increase of 0.01% with the current rate at 6.00%
• 30-Yr FRM rates are seeing an increase of 0.07% with the current rate at 6.79%
MND Rate Index
• 30-Yr FHA rates are seeing a decrease of -0.17% for this week. Current rates at 6.40%
• 30-Yr VA rates are seeing a decrease of -0.15% for this week. Current rates at 6.43%
Jobless Claims
Initial Claims were reported to be 221,000 compared to the expected claims of 220,000. The prior week landed at 218,000.
What’s Ahead
Consumer Price Index and Producer Price Index inflation ahead. There are no other influential reports on the schedule.
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