Jobless Claims

With the holiday season coming to a conclusion, there was little in the way of data releases. Last week, the main reports were the Chicago Business Barometer and the ISM Manufacturing Index, both indicating a slight contraction in the manufacturing sector. This comes as we await the upcoming administration change at the White House. The impact of this is relatively minimal, with lending rates continuing their downward trend. Next week we will be expecting the year-over-year for both the Consumer Price Index (CPI) and Producer Price Index (PPI), wrapping up 2024.

Chicago PMI

The Chicago Business Barometer, also known as the Chicago PMI, dropped further to 36.9 in December 2024, compared to November’s 40.2 and missing market forecasts of 42.5.

Primary Mortgage Market Survey Index

• 15-Yr FRM rates saw an increase of 0.13% with the current rate at 6.13%
• 30-Yr FRM rates saw an increase of 0.06% with the current rate at 6.91%

MND Rate Index

• 30-Yr FHA rates saw a decrease of -0.03% for this week. Current rates at 6.42%
• 30-Yr VA rates saw a decrease of -0.01% for this week. Current rates at 6.45%

Jobless Claims

Initial Claims were reported to be 211,000 compared to the expected claims of 225,000. The prior week landed at 220,000.

What’s Ahead

Both the year-over-year reports for the CPI and PPI as well as the first reports of inflation data for 2025 is on the release schedule.

With Christmas concluding the prior week, there were few reports other than Consumer Confidence, which had come in slightly below expectations. This should prove to have little impact, especially in the following week. With the New Year on the horizon, there are no reports other than the Chicago Manufacturing output report for the entire week. Happy Holidays!

Consumer Confidence

A post-election pop in consumer confidence fizzled at the end of the year, owing to worries about the U.S. stock market and a potentially higher cost of living as a result of new tariffs. The index of consumer confidence dropped 8.1 points to a three-month low of 104.7 in December, the privately run Conference Board said Monday.

Primary Mortgage Market Survey Index

• 15-Yr FRM rates saw an increase of 0.08% with the current rate at 6.00%
• 30-Yr FRM rates saw an increase of 0.13% with the current rate at 6.85%

MND Rate Index

• 30-Yr FHA rates saw an increase of 0.03% for this week. Current rates at 6.45%
• 30-Yr VA rates saw an increase of 0.03% for this week. Current rates at 6.46%

Jobless Claims

Initial Claims were reported to be 219,000 compared to the expected claims of 225,000. The prior week landed at 220,000.

What’s Ahead

Chicago PMI Report will be the only release for next week.

The rate cut by the Federal Reserve was hotly anticipated, and as predicted, they proceeded with the reduction, signaling the possibility of further cuts depending on inflation data. Although markets were generally receptive to the positive news, other government-related issues had dampened the high spirits temporarily. Outside of the rate decision, the PCE Index (the Federal Reserve’s preferred inflation indicator) has performed positively by beating the forecast. In addition, the Consumer Sentiment was exactly where it should be as expected.

PCE Index

The PCE index increased a scant 0.1% last month, the government said Friday. That’s the smallest rise in three months and just half as much as economists polled by The Wall Street Journal predicted. The barometer of U.S. inflation favored by the Federal Reserve rose more slowly than expected in November, breaking what appears to be a gradual drift higher in prices that forced the central bank to scale back plans to cut interest rates.

FOMC Rate Decision

The Federal Reserve on Wednesday cut interest rates by a quarter point, the third rate cut since it began to lower borrowing costs in September. The central bank’s latest move leaves its benchmark lending rate at a range of 4.25%-4.5%, a two-year low.

Primary Mortgage Market Survey Index

• 15-Yr FRM rates saw an increase of 0.08% with the current rate at 5.92%
• 30-Yr FRM rates saw an increase of 0.12% with the current rate at 6.72%

MND Rate Index

• 30-Yr FHA rates saw an increase of 0.10% for this week. Current rates at 6.42%
• 30-Yr VA rates saw an increase of 0.10% for this week. Current rates at 6.43%

Jobless Claims

Initial Claims were reported to be 242,000 compared to the expected claims of 220,000. The prior week landed at 224,000.

What’s Ahead

With an extremely light release schedule ahead of Christmas, the jobs release data will be the only important release.