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Economic Update by P. DUFFY
Consumer Price Index up 0.3 percent in January and 1.4 percent year-on-year
What does this mean? Inflation remains mostly subdued, with the largest monthly increases for gasoline, fuel oil and apparel.
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in January, and was up 1.4 percent year-on-year. Most of this monthly increase was due to gasoline, with its index rising 7.4 percent. The index for all items less food and energy was unchanged in January, and was up 1.4 percent year-on-year.
Home building expected to perform well in 2021, although affordability challenges loom
What does this mean? Single-family production could exceed 1 million units in 2021 as multi-family production set to stabilize by 2022
According to economists speaking at an online press conference in conjunction with the online Int’l Builders Show, while the home building industry is poised for another solid year in 2021, regulatory and supply-side challenges could harm housing affordability, slowing momentum and limiting growth.
Purchase loans dip 5 percent from previous week, but still up 17 percent year-on-year
What does this mean? The highest mortgage rates since last November led to a dip in mortgage activity, but the market remains quite strong.
The Market Composite Index for mortgage applications decreased 4.1 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 5 percent (but up 17 percent year-on-year) and refinance activity falling 4 percent (but up 46 percent year-on-year). The average contract interest rate for 30-year fixed-rate mortgages increased to 2.96 percent.