Rates Increase on Mixed Economic Data

Mortgage interest rates increased this past week as economic data was mixed. Economic data stronger than expected included the NFIB Small Business Optimism Index, July JOLTS Job Openings, Jobless Claims, the August Consumer Price Index (CPI), and the September New York Empire State Manufacturing Index. August CPI was up 0.4% on expectations that it would be up 0.3%. Year over year, CPI is up 1.9%. Economic data weaker than expected included the August Producer Price Index (PPI), August Retail Sales, August Industrial Production and Capacity Utilization, and the University of Michigan Consumer Sentiment Index. The Treasury auctioned $56 billion of 3 Year Notes, 10 Year Notes, and 30 Year Bonds which were met with somewhat weak demand. North Korea launched another missile over Japan, increasing global tensions. President Trump continues to call for tax cuts. There is increasing belief that the European Central Bank may begin winding down its quantitative easing at its October meeting.

The Dow Jones Industrial Average is currently at 22,243, up almost 450 points on the week. The crude oil spot price is currently at $49.87 per barrel, up over $2 per barrel on the week. The Dollar strengthened versus the Euro and Yen on the week.

Next week look toward Monday’s Housing Market Index, Housing Starts and Import and Export Prices, Wednesday’s Existing Home Sales and FOMC Meeting Announcement, Thursday’s Jobless Claims, Philadelphia Fed Business Outlook Survey, and FHFA House Price Index, and Friday’s PMI Composite Flash as potential market moving events.