Economic Summary from Bank of America by Elaine360

Elaine Golden Gealer, Brentwood condos, Brentwood townhomes, Brentwood real estate, Brentwood new construction, Brentwood condominiums, Westwood condos, Westwood townhomes, Westwood real estate, Westwood new construction, Westwood condominiums, Westchester condos, Westchester townhomes, Westchester real estate, Westchester construction, Westchester condominiums, Toluca Lake condos, Toluca Lake townhomes, Toluca Lake real estate, Toluca Lake construction, Toluca Lake condominiums, North Hollywood condos, North Hollywood townhomes, North Hollywood real estate, North Hollywood new construction, North Hollywood condominiums, Sherman Oaks condos, Sherman Oaks townhomes, Sherman Oaks real estate, Sherman Oaks new construction, Sherman Oaks condominiums, Encino condos, Encino townhomes, Encino real estate, Encino new construction, Encino condominiums, Beverly Hills condos, Beverly Hills townhomes, Beverly Hills real estate, Beverly Hills new construction, Beverly Hills condominiums, West Los Angeles condos, West Los Angeles townhomes, West Los Angeles real estate, West Los Angeles new construction, West Los Angeles condominiums, West Hollywood condos, West Hollywood townhomes, West Hollywood real estate, West Hollywood new construction, West Hollywood condominiums, Santa Monica condos, Santa Monica townhomes, Santa Monica, real estate, Santa Monica new construction, Santa Monica condominiums, San Fernando Valley condos, San Fernando Valley townhomes, San Fernando Valley real estate, San Fernando Valley new construction, San Fernando Valley condominiums.While last week’s economic calendar may have started off on the quiet side, the news picked up steam in the second half of the week. Read on for the highlights.

Table Source: Vantage Production, LLC

There was good news in the labor markets, as weekly initial jobless claims fell by 32,000 in the latest week to 300,000. This was near a seven-year low and a signal that the labor markets may be coming out of hibernation. In addition the four-week moving average of claims, which irons out seasonal abnormalities, also fell. Meanwhile, the Consumer Sentiment Index for April came in above expectations, showing that consumers are feeling positive about the economy.

The housing sector also had positive news to report, as foreclosure activity across the nation continues to decline. RealtyTrac reported that foreclosure filings fell to the lowest level since the second quarter of 2007. In addition, March was the forty-second consecutive month where foreclosure activity decreased from the previous year, with foreclosure filings declining by 23 percent from March 2013 to March 2014.

What does this mean for home loan rates? Typically good news helps stocks improve at the expense of bonds, including mortgage bonds (the type of bonds on which home loan rates are based). However, bonds and home loan rates improved last week as the stock market corrected from recent gains.

In addition, the minutes from the March meeting of the Federal Open Market Committee imply that the Fed will continue tapering its bond and Treasury purchases this year. Remember that the Fed is now purchasing $30 billion in Treasuries and $25 billion in Mortgage Bonds to help stimulate the economy and housing market. This is down from the original $85 billion per month that the Fed had been purchasing. Additional tapering of these purchases will continue to impact our economy and home loan rates as we move ahead this year, and this is an important story to monitor.

Forecase for the Week

This week features an array of reports touching on key segments of the economy.

  • Economic data came right out of the gate on Monday with Retail Sales, which is a measure of consumer spending.
  • On Tuesday, we got a read on inflation at the consumer level with the Consumer Price Index.
  • Key manufacturing data came out on Tuesday also, with the Empire State Index, followed by the Philadelphia Fed Index on Thursday.
  • Housing numbers from the National Association of Home Builders  Housing Market Index were reported on Tuesday, while Housing Starts and Building Permits for March follow on Wednesday. These reports may show if the soft numbers earlier this year were due to the harsh winter weather—or if they were the start of a downtrend.
  • As usual, weekly Initial Jobless Claims will be released on Thursday.

All capital markets will be closed on Friday in observance of Good Friday. In addition, the bond markets will close early on Thursday at 2:00 p.m. EDT.

As you can see in the chart below, foreclosure activity continues to decline. With more housing reports ahead this week, it will be interesting to see if the sector shows strong numbers after the harsh weather’s impact earlier this year.

Elaine
DRE #00598428
Senior Director, Coldwell Banker New Homes Division
With over 200 condominium, townhome and loft projects successfully marketed
“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

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