The week ended with mortgage rates still at 4% and the 10 year bond at 1.96% down .02% for the week and in the middle of its narrow trading range for the week. All-in-all, a stable but uncertain market. Europe is as stable as i'ts been but everything is relative. Spain has to do something about its debt issues and the world is hoping that the silence is just Spain developing a great plan.
US existing home sales came in at 4.48 million, down 2.6% from February and well below the consensus of 4.62m and outside the consensus range of 4.5-4.72 million. This is contrary to the hopes from the RE/MAX report earlier in the week that overall sales were up. Existing home sales are still up 5.2% for the year.
MBA reports that purchase mortgage applications were down 11.2%. While a significant drop, it's not unexpected as we saw a sharp spike in purchase applications the end of March as consumers rushed to beat the scheduled FHA mortgage insurance premium increase.
New jobless claim filings were unexpectedly up to 386K. Consensus was 365K claims. To make it worse, February was revised up 8000 to 388,000. Continuing claims were also up 26K to 3.3 million.
As jobless and employment numbers continue to come in, we all have to wonder how Washington is computing the unemployment rate these days. Initial jobless claims continue to outpace job growth, meaning we’re still gaining unemployed. Continuing jobless claims remain consistent meaning we’re just replacing those that fall off. The total workforce numbers have been dropping as people give up and leave the workforce. Yet the unemployment rate continues to drop. Mathematically, how does that work? If you think back to fractions and percentages in grade school, if the numerator (unemployed/jobless) stays the same or gets bigger and the denominator (workforce) gets smaller, the percentage increases, not decreases. I guess it's more Washington “fuzzy math”. After all the electioneering has begun.
Have a great weekend.
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