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Food and Rent Rise While Energy Falls to Balance Inflation

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Mortgage and Lending with The Federal Savings Bank/Lending in 50 states NMLS # 109616

Consumer inflation remained tame in September as increases in costs for food and rent were offset by declines in energy prices. The Labor Department reported that the Consumer Price Index (CPI) was unchanged in September and was the weakest read since January. The so-called Core CPI, which strips out volatile food and energy, rose 0.1% from the 0.3% increase seen in August. Inflation continues to run low and will remain subdued for a few more years, says the Federal Reserve.

Mortgage rates edged lower in the last survey and remain at three-year lows, which is giving the housing market a boost. Freddie Mac reports the 30-year fixed-rate mortgage averaged 3.57% with an average of 0.6 points for the week ending October 10, 2019, down from last week's 3.65%. A year ago at this time, the 30-year rate averaged 4.90%. Sam Khater, Freddie Mac’s Chief Economist said, "The fifty-year low in the unemployment rate combined with low mortgage rates has led to increased homebuyer demand this year. Much of this strength is coming from entry-level buyers."

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