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Jobless
Claims Fall
An improving
US economic outlook was negative for mortgage rates this week. Reduced
concerns about Europe also caused a partial reversal in the flight to
safety trade. As a result, mortgage rates ended the week higher.
Early in
the month, the December Employment report showed a larger than expected
increase of 200K jobs, and the Unemployment Rate continued to move lower.
This week, Weekly Jobless Claims fell to the lowest level since April 2008.
The labor market is one of the most important factors in the health of the
economy, and many investors now view the outlook as brighter than it has
been since the financial crisis began. If this is the case, it will be
great news for the economy, and job gains will increase the willingness and
the ability of people to purchase homes.
The
Housing sector data released this week was encouraging as well. January
Existing Home Sales increased 5%, while the inventory of unsold homes
declined 9%, to the lowest level since March 2005. December Housing Starts
for single-family units increased 4%, and Building Permits for
single-family units rose 2%. Finally, the January NAHB Home Builder
confidence index rose for a fourth consecutive month to the highest level
since 2007. Improving economic conditions, high affordability levels, and
low mortgage rates provide solid reasons to be optimistic about the housing
market.
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Also Notable:
- Core CPI inflation was 2.2% higher than one year
ago
- Existing Home Sales rose to the highest level in
eleven months
- The Treasury will auction $99 billion in 2-yr,
5-yr, and 7-yr securities next week
- Greece moved closer to reaching an agreement with
its creditors
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Average
30 yr fixed rate:
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Last
week:
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-0.05%
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This
week:
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+0.08%
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Stocks
(weekly):
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Dow:
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12,650
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+350
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NASDAQ:
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2,780
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+80
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Week
Ahead
The most
highly anticipated economic news next week will be Wednesday's Fed
announcement. Investors will be looking for hints about whether the Fed
will provide additional monetary stimulus. The most significant economic
report will be Friday's GDP data for the fourth quarter. GDP is the
broadest measure of economic activity. Before that, Pending Home Sales will
be released on Wednesday. Durable Orders and New Home Sales will come out
on Thursday. Leading Indicators and Consumer Sentiment will round out the
schedule. In addition, there will be Treasury auctions on Tuesday,
Wednesday, and Thursday. |
Apply for a Home Loan TODAY!!!
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