Fed Officials See Interest Rate Cuts Getting Closer

While Feder🌄al Reserve officials are signaling they are coming closer to an interest rate cut decision, central bankers this week were leaving opeꩵn their timetables on when they may take action.

In a speech titled “Getting Closer,” Federal Reserve Gov. Christopher Waller said the most likely economic scenario for the coming months includes “uneven” inflation data. In his forecast, price pressures won't ease as fast as expected.

“In this case, a rate cut in the near future is more uncertain,” Waller told an audience at the Kansas City Federal Reserve Wednesda𒀰y.

Like Federal Reserve Chair Jerome Powell and other officials in recent appearances, Waller didn’t lay out when he expects rate cuts. However, Waller said if 澳洲♑幸运5开奖号码历史查询:inflation reports continue the trend estab🌌lished in May, a rate cut cou𒈔ld be in the “not-too-distant” future.

“I s💟ee a significant but not high probability of💞 this scenario occurring,” Waller said.

Waller's comments echoed his colleagues. The day before, Federal Reserve Gov. Adriana Kugler also said she believed inflation would continue to move lower.

At its most recent meeting in June, Fed officials forecast only one interest rate cut this year. However, economic data released since has convinced traders the Fed will cut 澳洲幸运ꦆ5开奖号码历史查询:interest rates earlier and more than that prediction.

“If economic conditions continue to evolve in this favo🐬rable manner with more rapid disinflation—as evidenced in the inflation data of the past three months—and employment softening but remaining resilient as seen in the past few jobs reports, I anticipate that it will be appropriate to begin easing monetary policy later this year,” Kugler told an economics conference in Washington, D.C.

-Terry Lane

Uptick in June Construction Hides Worsening Single-Family Home Building 

Home builders were bus🐻ier in June, but eco🤡nomists said it wasn’t the type of housing construction surge they hoped to see. 

澳洲幸运5开奖号码历史查询:Housing starts came in at an annual rate of 1.35 million in June, an increase of 3% 澳洲幸运5开奖号码历史查询:from the prior month, while building permits made a similar jump to hit an annual rate of 1.45 million, Census Bureau data showed. Both hovered near economists' forecasts.♈ 

While home construction was higher, Wells Fargo economists Charlie Dougherty and Jackie Benson said ▨the headline numbers🔯 belie subdued homebuilder activity. Multifamily housing, such as apartments and condos, drove most of the gains in June.

Permits and housing starts for single-family homes were♏ lower in June, as builders continue to contend high interest rates.

-Terry Lane

Mortgage Applications Jump as Homeowners Chase Refinancing on Rate Dip

Mo🍒rtgage applications surged last week as many homeowners took advantage of a dip in mortgage rates to refinance their existing home loans.

The Market Composite Index increased 3.9% for the week ending July 12, data from the Mortgage Bankers Association (MBA) showed. The 30-year, fixed-rate mortgage dropped to 6.87% last week, its low♛est rate since M🌱arch.

Refinancing moved higher by 15% on the dip in rates, pushing to its highest levels since August 2022 and up 37% compared with last year’s levels. Much of the increased activity came from government-sponsored loans like 澳洲幸运5开奖号码历史查询:Federal 🌱Housing Administration (FHA) and 澳洲幸运5开奖号码历史查询:Veterans Administration (VA) loans.

“While FHA 𓃲and VA refinance applications accounted for a significant share of the increase, these are likely recently originated loans with even higher than current offered rates,” said Joel Kan, MBA vice president and deputy chief economist.

While refinancing surged, home purchase applications continued to lag, down 3% compared 澳洲幸运5开奖号码历史查询:with the prior week, and lower by 14% from the same week last year.

-Terry Lane