Mortgage Market Update (6/17/24)

Welcome to Homeseed’s Mortgage Market Update, where we dive into the latest trends, insights, and changes shaping the dynamic landscape of the housing and lending industries.

Mortgage Rate Trends & Forecasts

  • It’s been a volatile week for rates as they are now slightly lower than where they were a week ago.
  • A strong BLS Jobs Report earlier in the month moved rates higher before last week’s CPI report brought them back down.
  • Last Thursday’s Producer Price Index helped rates move even lower as inflation measured from the perspective of manufacturers came in much lower than expected.

Consumer Price Index (CPI)

  • The May CPI report showed that overall inflation was flat at 0% month-over-month (expected 0.1%) and decreased year-over-year from 3.4% to 3.3%.
  • May brought cooler than expected consumer inflation, due in large part to easing motor vehicle insurance costs.
  • This follows better than expected readings in April as the annual Headline and Core readings both took important steps lower.

The Fed Meeting

  • The Fed’s fourth meeting of the year concluded last Wednesday and left their Fed Funds Rate unchanged once again.
  • An updated dot plot showed that the median forecast for the rest of the year would be one rate cut.
  • Fed Chair Jerome Powell acknowledged that their policy is restrictive but needs to see more progress on inflation lowering.
  1. RATES DROP AFTER CPI DATA – Lower inflation numbers help bring rates back down after last week’s spike from the BLS jobs data.…
  2. WHOLESALE PRICES COME DOWN – The Producer Price Index (PPI), a gauge of prices that producers get for their goods and services, declined 0.2% for the month.…
  3. MORTGAGE APPLICATIONS RISE IN MAY – New-home purchase mortgage applications rose 1% month-over-month in May according to the Mortgage Bankers Association (MBA).…
  4. VA NOW ALLOWING BUYER-PAID BROKER FEES – Veterans using VA home loan benefits will have the ability to pay the buyer-broker fee beginning August 10, 2024.…

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