Consumer confidence reached an all-time low and 100,000 Americans were issued layoff notices last week. For the 3rd consecutive week, mortgage rates rose and average loan fees increased.
Amid all of the negative economic news, however, there were two bright spots worth identifying.
First, the supply of "used" homes for sale fell from 11 months to 9 months nationwide. This suggests homebuyers are re-entering the housing market in force and signals home prices are nearing equilibrium.
And, second, the nation's GDP -- a measurement of the country's complete economic footprint -- didn't fall by nearly as much as experts predicted. A positive surprise like this makes us wonder what else the Doomsday Economists may be wrong about.
We won't have to wonder long.
This week we have a large amount of data, legislation and rhetoric to influence mortgage rates. Some of the news mortgage markets will digest this week include:
- The Personal Consumption Expenditures Index report. PCE is a preferred inflation measurement and inflation is the enemy of mortgage rates. A high reading may pressure mortgage rates up.
- Retail stores report on same-store sales.
- The Pending Home Sales report. This notes the number of "homes under contract" and is a good gauge for buyer interest and the general health of housing.
- 20% of the S&P 500 firms will report earnings.
- Congress is expected to vote on the Stimulus package.
The biggest impact on rates, however, could come Friday with the release of January's jobs report. Employment data is always a market-mover and with the press giving so much attention to layoffs lately, expect Wall Street to be extra jittery it.