Looking back at October 2022 MBS trends, inflation once again dominated headlines as the Federal Reserve and ECB continue to raise rates.
Following this week’s September 2022 Core PCE report, investors scaled back their outlook as the data matched the overall consensus.
This week saw the release of the highly anticipated August 2022 Employment data. Overall, the report displayed mixed results for the labor market.
As the European Central Bank faces record-high inflation levels, this week’s biggest news marked the first ECB rate increase in 11 years.
In recent months, high inflation (and higher mortgage rates) took a large toll on mortgage application volumes.
This past week saw luxury home sales rise as the market overcomes age-old housing challenges. Although the market saw little economic news, mortgages rates also rose. Ultimately, investors still focus on higher inflation.
As expected, the latest European Central Bank announcement came out this week. After months, they finally announced the expected policy change in its bond purchase program.
Key labor market data revealed mixed results, including dampened job gains missing the mark. However, a better unemployment rate counterbalanced those job gains.
This past week saw an informative ECB meeting and Fed report, indicating the best mortgage rate outcome heading into summer 2021. Despite a stronger than expected inflation report, investors focused elsewhere. Overall, the European Central Bank meeting provided a favorable result. Thus, mortgage rates ended the week a little lower. Informative ECB Meeting & Federal Reserve Report Thursday saw an informative ECB meeting. During the meeting, the European Central Bank (ECB) made no policy changes. Conclusively, the lack of change reflects the best-case outcome for mortgage rates. Simultaneously, the ECB made no mention of a specific time frame for starting to scale back its bond purchase program. For analysts, the meeting statement tone felt relatively dovish. Investors widely expect that the ECB tightens monetary policy rather than to loosen it. For now, holding steady exemplifies positive news. Meanwhile, the Federal Reserve reported that household net worth at the end of the first quarter of 2021 soared 3.8% higher than at the end of 2020. Roughly $3.2 trillion of gains originated from stocks. Aside from stocks, $1.0 trillion stemmed from increased real estate values. Core CPI Improves Aside from the informative ECB meeting, the Consumer Price Index report came out. Analysts [...]