Weekly Market update

Pending Home Sales Pending Home Sales—signed contracts on existing homes—rose 1.9% in October, beating expectations of a 0.5% gain. On a year-over-year basis, sales are essentially flat, down just 0.4%. The trend, however, continues to improve. This is the third consecutive monthly increase, and the pace of activity is now at the highest level of […]

Fed Commentary Shifts Rate Expectations   This morning, New York Fed President John Williams signaled that the Fed may need to cut rates in the near term, noting that labor-market weakness now poses a greater risk than inflation. “Near term” is doing a lot of heavy lifting here—it’s a clear indication he would support a […]

Diana Olick from CNBC is back with another alarming headline—but once again, the narrative doesn’t match the full story. For years, Olick has been consistently negative on housing, even as the market has proven remarkably resilient. Over the past five years alone, home prices have climbed roughly 60%, despite repeated predictions of major declines. Housing […]

Revelio Labs — Labor is Still Softening Revelio Labs — which we respect a lot — publishes their own “Jobs Report” by tracking over 100 million U.S. profiles. That’s roughly two-thirds of the workforce. Compare that to BLS — which captures only 27% — and the Household Survey, which is literally 60,000 phone calls (0.03% […]

Fed Comments Kansas City Fed President Jeffrey Schmid was on CNBC this morning explaining why he dissented on Wednesday — he didn’t want the 25bp cut. And based on how he framed things, if a cut is proposed in December, he’ll likely dissent again. Schmid’s read on inflation is overstated. He called Core at 3%. […]

Consumer Price Index — September Update The September CPI report came in slightly cooler than expected, showing overall inflation rising 0.3% for the month, one tenth below forecasts. On a year-over-year basis, inflation ticked up from 2.9% to 3%, a touch softer than the market’s expectation of 3.1%. The biggest driver of the monthly gain […]

Why Adjustable-Rate Mortgages Deserve a Closer Look   Adjustable-Rate Mortgages (ARMs) have been gaining real momentum, making up a growing share of total loan applications. As the Fed continues to ease and rates trend lower, that momentum will likely build. Many borrowers shy away from ARMs because of their variable nature after the fixed period—but […]

National Retail Federation Report   With federal data releases on pause, market watchers have been relying more on private sector reports for clues on the economy. The National Retail Federation’s (NRF) version of September Retail Sales showed a broad and meaningful pullback in consumer spending — a sharp contrast to the resilience we’ve seen all […]

Fed Talk Chicago Fed President Austan Goolsbee joined CNBC this morning with some mixed messages on the labor market. He first described conditions as “pretty stable,” only to later admit they’re deteriorating. We’re not sure what more the Fed needs to see to acknowledge that the labor market is weakening — ADP has reported job […]

Personal Consumption Expenditures (PCE) The Fed’s favorite inflation gauge, PCE, showed headline inflation rising 0.3% in August, coming in a touch hotter than expected. On an annual basis, the rate edged higher from 2.6% to 2.7%, exactly in line with market estimates. Core PCE—which strips out food and energy and is the Fed’s main focus—rose […]