Last week’s economic reporting included readings on minutes of the most recent Federal Open Market Committee meeting and its customary post-meeting press conference, labor-sector data on public and private-sector jobs, and the national unemployment rate. Weekly readings on mortgage rates and jobless claims were also released.

FOMC Meeting: Policymakers seek a balance between high inflation and rising rates

The minutes of the Federal Open Market Committee meeting held on December 13 and 14 reflect committee members’ concern over controlling rapidly growing inflation while avoiding a recession. While committee members said that they made “significant progress” in raising rates to cut inflation, members said they needed to avoid raising rates too fast and creating a recession. Policymakers asked for “flexibility” from investors and consumers.

The Fed’s monetary policy actions depend on economic developments; if high inflation persists, policymakers will likely continue raising the Fed’s target interest rate range. If inflation eases, so will the Fed’s pace of raising its target interest rate range. The Fed re-asserted its goal of achieving two percent inflationary growth. The meeting minutes emphasized that the Committee’s decision to slow the pace of interest rate growth did not indicate any changes to the Fed’s goal of two percent inflation.

Mortgage rates rise, jobless claims fall

Freddie Mac reported higher mortgage rates last week as the average rate for 30-year fixed-rate mortgages rose by six basis points to 6.48 percent. The average rate for 15-year fixed-rate mortgages was five basis points higher at 5.73 percent.

204,000 new jobless claims were filed last week, which fell short of the expected reading of 223,000 initial claims filed and the previous week’s reading, also of 223,000 first-time claims filed. Continuing jobless claims fell to 1.69 million claims filed as compared to the previous week’s reading of 1.72 million ongoing claims filed.

The national unemployment rate fell to 3.5 percent in December as compared to 3.6 percent n November and the expected unemployment rate of 3.7 percent.

What’s Ahead

This week’s scheduled economic reporting includes readings on month-to-month and year-over-year inflation and weekly readings on mortgage rates and jobless claims.

Last week’s economic reporting included readings on U.S. housing markets, pending home sales, and weekly readings on mortgage rates and jobless claims.

S&P Case Shiller Home Price Indices:  Month-to-moth home prices fall in October

U.S. home prices fell in October for the fourth consecutive month. Wavering demand for homes was caused by rising mortgage rates and high home prices in many regional markets. The 20-City home price index showed the top three cities with the highest month-to-month home price declines were Miami. Florida with a -1.0 percent decline, Tampa, Florida where home prices declined by -0,8 percent, and Charlotte, North Carolina where home prices dropped by -0.9 percent month-to-month in October.

Year-over-year home prices rose by 21 percent in Miami, Florida; year-over-year home prices rose by 20.5 percent in Tampa, Florida. Charlotte, North Carolina reported a year-over-year home price gain of 15.0 percent as of October.

The Federal Housing Finance Agency reported that home price growth was flat from September to October as compared to a month-to-month gain of 0.10 percent in September. Analysts said that high home prices and mortgage rates have decreased demand for homes as would-be buyers face affordability issues and strict mortgage credit requirements.

Mortgage Rates Mixed, Jobless Claims Rise

Freddie Mac reported higher fixed mortgage rates last week as the average rate for 30-year fixed-rate mortgages rose by 15 basis points to 6.42 percent. Rates for 15-year fixed-rate mortgages fell by one basis point to an average of 5.68 percent.

New jobless claims rose last week to 225,000 initial claims filed as compared to 216,000 initial claims filed in the previous week. Analysts expected a reading of 223,000 first-time jobless claims filed. Ongoing jobless claims rose last week with 1.71 million continuing jobless claims filed as compared to 1.67 million continuing jobless claims filed in the previous week.

What’s Ahead

This week’s scheduled economic news includes readings on construction spending, minutes of the most recent Federal Open Market Committee meeting, and public and private-sector jobs data. Weekly reports on mortgage rates and jobless claims will also be released.