Wholesale inflation was rather tame in April with the smallest amount of gains seen since the end of 2017. The decline was led by lower prices for food and gas. The April Producer Price Index rose by 0.1%, below the 0.2% expected and down from the 0.3% recorded in March. On a year-over-year basis, the Producer Price Index slipped to 2.6% from the 3% seen in March on an annual basis. The more closely watched Consumer Price Index will be released on Thursday.
Mortgage rates remained steady in the latest week and though they have risen to multi-year highs in 2018, they still remain historically attractive. The Mortgage Bankers Association (MBA) reports that its Market Composite Index, a measure of total mortgage loan application volume, fell 0.4% in the latest week with little change in rates. The MBAs refinance index -0.6%, purchase index -0.2%. The MBA also reported that the 30-year fixed-rate mortgage fell to 4.78% from 4.80%, while the jumbo rate was little changed at 4.65%. The MBA mortgage rates carry at least an average 0.50 point added on top.
As the economy continues to grow and house prices rise, mortgage delinquency rates are on the decline. The serious mortgage delinquency rate, or those at least 60 days or more past due, decreased to 1.74% in the first quarter. This is down from 2.07% in the first quarter of 2017, marking the 19th straight annual drop since the third quarter of 2013. “Borrowers continue to perform well, making on-time payments that are more in line with traditional patterns observed prior to the mortgage crisis," said Joe Mellman, TransUnion senior vice president and mortgage business leader.
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