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There was little major market moving economic news this week. In light end of year trading, the stock market climbed to record levels, and mortgage rates finished a little higher.
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The housing sector reports released this week were mixed. A lack of inventory continued to hold back home sales in many regions, but there were encouraging signs that the pace of construction may be picking up. In November, sales of previously owned (existing) homes unexpectedly decreased from October, but still were 3% higher than a year ago. National median existing-home prices were up 6% from a year ago. The inventory of homes for sale was 6% lower than a year ago.
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However, housing starts in November increased more than expected from October and were 14% higher than a year ago. Building permits, which are a leading indicator of future construction, were at the best level since May 2007. In addition, the NAHB housing index showed that home builder confidence jumped to 76, far above the readings near 60 seen a year ago, and the highest level since 1999.
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The latest inflation data revealed that it continued to hold steady at relatively low levels. In November, the Core PCE index, which excludes the volatile food and energy components, was just 1.6% higher than a year ago, the same annual rate of increase as last month. This remained well below the Fed's stated target level of 2.0%.
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Looking ahead, New Home Sales will be released on Monday and Durable Orders on Tuesday. In addition, news about the trade negotiations with China or the impeachment inquiry could have an influence. Trading volume in mortgage markets often is very light during the last couple of weeks of December which can lead to increased volatility. Mortgage markets will close early on December 24 and will be closed on December 25 for Christmas.
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| Weekly Change |
| 10yr Treasury |
rose |
0.08 |
| Dow |
rose |
300 |
| NASDAQ |
rose |
150 |
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| Calendar |
| Mon |
12/23 |
New Home Sales |
| Tue |
12/24 |
Durable Orders |
| Thu |
12/26 |
Jobless Claims |
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All material Copyright © Ress No. 1, LTD (DBA MBSQuoteline) and may not be reproduced without permission.
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