![Mortgage Investors Group in [Dynamic1]](../assets/images/mortgage-investors-group.svg)
Market Comment
Mortgage bond prices finished the week higher which put a little downward pressure on rates. US election uncertainty factored into trading the first portion of the week. The data was mixed. Existing home sales were 3.89M vs 4M. New home sales were 617K vs 640K. The trade deficit was $96.8B vs 98B. Solid GDP data Thursday resulted in some weakness that morning. GDP rose 2.8% vs 2%. However, durable goods fell 6.6% vs the expected 0.3% increase which helped counter some of the selling pressure. Consumer sentiment was 66.4 vs 66 which was relatively in line with estimates. Personal income rose 0.2% vs 0.4%. Outlays rose 0.3% as expected. Core PCE inflation rose 0.2% vs 0.1%. Mortgage interest rates finished the week better by approximately 1/8 of a discount point.
Looking Ahead
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
|---|---|---|---|
| FHFA House Price Index | Tuesday, July 30, 10:00 am, et | Up 0.3% | Moderately Important. A measure of single-family house prices. Weakness may lead to lower rates. |
| Consumer Confidence | Tuesday, July 30, 10:00 am, et | 99.9 | Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates. |
| ADP Employment | Wednesday, July 31, 8:15 am, et | 155K | Important. An indication of employment. Weakness may bring lower rates. |
| Q2 Employment Cost Index | Wednesday, July 31, 8:30 am, et | Up 1.2% | Very important. A measure of wage inflation. Weakness may lead to lower rates. |
| Fed Meeting Adjourns | Wednesday, July 31, 2:15 pm, et | No rate changes | Important. Few expect the Fed to change rates, but some volatility may surround the adjournment of this meeting. |
| Weekly Jobless Claims | Thursday, Aug. 1, 8:30 am, et | 220K | Important. An indication of employment. Higher claims may result in lower rates. |
| Preliminary Q2 Productivity | Thursday, Aug. 1, 8:30 am, et | Up 0.2% | Important. A measure of output per hour. Improvement may lead to lower mortgage rates. |
| ISM Index | Thursday, Aug. 1, 10:00 am, et | 48.8 | Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates. |
| Employment | Friday, Aug. 2, 8:30 am, et | 4.1%, Payrolls +185K | Very important. An increase in unemployment or weakness in payrolls may bring lower rates. |
Productivity
Productivity is the rate at which goods or services are produced. It is most commonly defined in terms of labor, which is the contribution of people to the process. Labor costs represent about two thirds of the value of the output produced. The Bureau of Labor Statistics of the US Department of Labor releases the most widely cited productivity statistics quarterly and annually. Increased productivity is often credited for economic growth with little signs of inflation. Productivity is significant in that as it increases, businesses can produce more with the same or less input. This wealth building effect is vital to the US economy. As productivity increases, the US economy generally performs better. As productivity decreases, the economy generally suffers.
