as United States Federal Reserve Policymakers will meet this week and are likely to keep their benchmark interest rates unchanged, as a recent decline in mortgage rates has stabilized.
house lineThe average interest rate on a 30-year conforming loan was 7.01% on Tuesday, according to the Mortgage Rate Center. The number was unchanged from the same period last week. The 15-year qualified interest rate, which has been volatile recently, averaged 6.79% on Tuesday, up 13 basis points from a week ago and the same as two weeks ago.
HousingWire principal analyst Logan Mohtashami noted that Tuesday’s Job Openings and Labor Turnover Survey (JOLTS) report comes from U.S. Bureau of Labor Statistics The (Bureau of Labor Statistics) shows the labor market is relatively unchanged from cooling. The number of job openings nationwide fell to a preliminary estimate of 8.18 million in June from 8.23 million in May. The 10-year Treasury yield, which affects mortgage rates, rose only slightly after the JOLTS report was released.
The Bureau of Labor Statistics’ full employment report for July is scheduled to be released on Friday. Last month’s report showed the U.S. added 206,000 jobs, down from 272,000 in May. Unemployment rose from 3.6% to 4.1% in the year to June 2024, while rising interest rates appeared to be cooling the economy, while annualized inflation fell to 3%, a sharper-than-expected decline.
Meanwhile, most analysts expect Fed officials to keep the benchmark interest rate in a range of 5.25% to 5.5% on Wednesday. this CME GroupAlthough all parties agree to cut interest rates in September, the FedWatch tool shows that the probability of no change is close to 96%. Federal Reserve Chairman Powell will hold his customary post-meeting press conference at 2 pm Eastern Time on Wednesday.
“The Fed’s June economic forecast summary shows only one interest rate cut in 2024, down from the three rate cuts expected in March,” said Odeta Kushi, deputy chief economist at the Fed. first american, said in a statement. “However, continued weak inflation data and a weak labor market keep the possibility of further rate cuts still alive, with markets betting on three rate cuts this year. By the end of 2025, policymakers expect the policy rate to reach 4.1%, which means There will be four more quarter-percentage reductions.
Mortgage rates have stayed above the 7% threshold for most of this year. The impact on home sales has been severe, but home prices have remained resilient.
On Tuesday, the CoreLogic S&P Case-Shiller index’s annual gain slowed to 5.9% in May, down from 6.5% in February and March. Nonetheless, the index hit a record high for the third consecutive month.
“The slowdown in annual growth continues to reflect residual comparisons to the strong spring of 2023, while also illustrating the impact of slower housing demand on cooling price growth,” core logic Chief Economist Thelma Hupp said in a statement.
“Towards the end of the spring home buying season, the housing market experienced a considerable cooling, with mortgage rates exceeding the 7% benchmark – which appears to be a psychological barrier for potential homebuyers deciding to enter the home buying process. Reflecting April Mortgage Rates Higher June existing home sales activity slowed to its lowest level since the financial crisis.