United States U.S. Economic Report provide by our Mortgage Partner
In a week packed with a Fed meeting, significant economic data, and Treasury auctions, there were no major surprises to be found. European events, often a source of market moving headlines, also had little impact this week. As a result, mortgage rates ended the week with little change.
After the Fed’s blockbuster announcement for a third round of quantitative easing at its last meeting, investors were anticipating no policy changes at Wednesday’s meeting. As expected, the Fed’s statement was very similar to the last one. Their assessment is that the economy is growing only “modestly”, justifying the current bond buying program.
Friday’s release of third quarter Gross Domestic Product (GDP), the broadest measure of economic activity increased at a 2.0% annual rate, slightly above the consensus forecast of 1.9%, and up from 1.3% in the second quarter. Many economists feel that a 2.0% growth rate is generally consistent with a steady labor market, but that a faster pace is necessary to see significant improvement in the level of employment. A primary reason for loose Fed policy is to help boost economic growth and create new jobs more quickly.
The biggest US economic report next week will be the important Employment data on Friday. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month. Before the employment data, Personal Income and Core PCE inflation will come out on Monday. Chicago PMI Manufacturing is scheduled for Wednesday. Productivity, ISM Manufacturing, and Construction Spending will be released on Thursday. Consumer Confidence and Factory Orders will round out a busy schedule.
Thank you Shea Neely, a Mortgage Loan Officer with Southern Crescent Mortgage, for this contribution.