Following the release of key data such as the FOMC rate decision and CPI and PPI inflation reports, only the PCE Index reports remained to set the course, which are coming in well within expectations. The Consumer Confidence Report is also a significant concern since it influences broader economic decisions when consumers hesitate to spend, usually due to rising living costs.
Consumer Confidence Report
Consumers were slightly more optimistic about the economy at the end of June, but the effects of high inflation in the past few years still weighed on their minds. The final reading of the consumer sentiment index rose to 68.2 in June from a preliminary 65.6 earlier in the month, but it’s still the lowest level in seven months. The index also stands well below a prepandemic peak of 101. Although Americans think inflation will ease, they say high inflation and slower income growth have worried them more about their finances, according to the University of Michigan survey.
PCE Index
The Federal Reserve’s preferred PCE index was unchanged last month, the government said Friday. Economists polled by The Wall Street Journal had forecast a flat reading. If inflation continues to recede in the next few months, the Fed could lay the groundwork to cut U.S. interest rates in the fall. The increase in inflation in the past 12 months slipped to 2.6% from 2.7%. The Fed is aiming to bring inflation down to 2% a year.
Primary Mortgage Market Survey Index
- 15-Yr FRM rates are seeing an increase by 0.03% with the current rate at 6.16%
- 30-Yr FRM rates are seeing a decrease by -0.01% with the current rate at 6.86%
MND Rate Index
- 30-Yr FHA rates are seeing an increase by 0.02% for this week. Current rates at 6.51%
- 30-Yr VA rates are seeing an increase by 0.02% for this week. Current rates at 6.52%
Jobless Claims
Initial Claims were reported to be 233,000 compared to the expected claims of 235,000. The prior week was landed at 239,000.
What’s Ahead
Next week, we anticipate ISM Manufacturing data, U.S. trade deficits, and overall U.S. unemployment figures to provide further insights into the direction of the economy. Despite being less comprehensive reports, they often serve as early indicators of inflation trends which are a crucial focus for all stakeholders.