Mortgage Rates Down Nearly a Quarter Point in March
The average 30-year, fixed mortgage rate fell to 6.74%, according to Freddie Mac data, adding to last week’s declines as mortgage rates continue to hover below 7%. The 15-year rate declined for the third straight week to 6.16%.
“Despite the recent dip, mortgage rates remain high as the market contends with the pressure of sticky inflation. In this environment, there is a good possibility that rates will stay higher for a longer period of time,” said Sam Khater, chief economist at Freddie Mac.
-Terry Lane
Retails Eked Out Growth, Details Point to Slowdown in Spending
"The consumer has a bit more capacity to spend but the consistent downward revisions should tell us the economy is slowing," said Jeffrey Roach, Chief Economist for LPL Financial.
Business Inventories Flat in January, Falling Short of Expectations
Business inventories were flat in January, missing the 0.2% increase that economists forecasted as retailers, wholesalers and manufacturers kept their merchandise at current levels.
Inventories at auto dealerships and furniture retailers were up in January, but general merchandise and department stores reduced their inventories to drag the index down to its flat reading. Additionally, the Census Bureau also revised its December 2023 growth down to 0.3%.
-Terry Lane
Producer Prices Came In Hotter Than Expected in February
The Producer Price Index (PPI) rose 0.6% last month, according to a Bureau of Labor Statistics report Thursday. Economists surveyed by Dow Jones Newswires and the Wall Street Journal expected the index to grow 0.3%, the same as it had in January.
Core PPI, which takes out volatile food and energy prices, was also higher than anticipated, coming in at 0.4%, above the 0.2% that economists forecasted. Over the year ending in February, the index increased 1.6%, the largest gain since September. Because PPI measures the change over time in the money producers receive for their output, it is often seen as a precursor to consumer price changes. If retailers have to pay producers more for their inventories, they often pass those price hikes to consumers.PPI is especially important because it includes factors that roll up into the Federal Reserve's preferred measure of inflation. Today's report could potentially help convince Fed officials to push back the timeline for rate cuts.
This blog post has been updated with additional information on the core index growth.
Far Fewer People Applied for Unemployment Than Expected Last Week
Some 209,000 applied for unemployment benefits for the first time last week, according to a report from the Labor Department Thursday. That's for less than the 218,000 economists expected and 1,000 less in the prior week.
The four-week moving average is often viewed as a less volatile number by economists and came in 500 people less than the prior week at 208,000.Many have been concerned that the Fed's fight against inflation would come at the cost of jobs, but today's report, paired with last week's findings on the labor market doesn't seem to imply large-scale layoffs.