Rates remain in the flattest trend they’ve seen in a long time. It may not seem like it if you’re looking at the up and down gyrations of rates day to day, but the trend since Q4 2022 has been in and around the mid-6 percent level for a 30-year fixed rate mortgage, for the most part. This week is no different, even though Freddie Mac’s weekly survey showed the rate improved slightly and since then rates started this week noticeably higher.
That being said, if you’ve been on the fence, waiting for a significant drop in rates, we may not see one imminently. Of course, we can’t predict the future, but I’m seeing rates remain in the mid-six percent range for a 30-year, which is historically not a bad rate.
As for market news, last week we saw the latest Jobs Report come out with job creation numbers beating expectations handily as the economy added 253,000 new jobs showing remarkable strength in the economy for April. We also saw the unemployment rate dip to 3.4 percent, the lowest rate since 1969.
This week we’ll get a look at some important inflation data with the release of both the Consumer Price Index (CPI) and the Producer Price Index (PPI). We heard the Fed last week comment that they see inflation moderating, so analysts will continue to pour over the data to see if the Fed’s prediction comes true.
First, we get a look at the CPI. Overall prices are expected to rise 0.4 percent after March’s percent 0.1 increase which was below expectations. Annual rates, which in March were 5.0 percent overall and 5.6 percent for the core, are expected at 5.0 and 5.5 percent, in other words showing little or no improvement.
As for wholesale prices, After falling 0.5 percent in March, producer prices in April are expected to rise 0.3 percent. The annual rate in April is seen at 2.5 percent and down slightly from March’s 2.7 percent. As we know, rates are sensitive to inflation changes, so if there are any surprises, rates may be affected.
As for the housing market, a survey by ServiceLink reported that the majority of respondents – of all generations – said they plan to consider buying a home this year. Fannie Mae’s Home Purchase Sentiment Index agreed, showing an increase in April to its highest level since May 2022. Consumers in the survey believe mortgage rates will improve and from the looks of it, will be ready to act when they do.
