Jobless claims stayed near historically low levels, and mortgage rates climbed to their highest point since 2010, reports showed Thursday.
Here’s a quick look at the most significant economic indicators of the day and what they tell us.
- Slightly fewer people filed for unemployment the week ending April 16, with the number of initial jobless claims falling to 184,000 from 186,000 the week before, the Department of Labor said.
- It was the ninth week in a row that claims have stayed under 200,000, a very low level by historic standards. With lots of job openings these days and few workers to fill them, companies are companies are reluctant to lay anyone off, economists said.
- The average 30-year fixed mortgage rate rose to 5.11% this week, its highest level since 2010, mortgage giant Freddie Mac said.
- Soaring mortgage rates have dramatically increased the cost of buying a home, even before the surge over the past few weeks. That’s making it more difficult for would-be buyers to afford monthly payments and dampening overall demand for homes in what has been an extreme seller’s market.
- Mortgage rates typically follow yields on 10-year Treasuries, which have spiked since the Federal Reserve began taking steps to battle inflation, including raising its benchmark interest rate.
- “While springtime is typically the busiest homebuying season, the upswing in rates has caused some volatility in demand,” said Sam Khater, Freddie Mac’s chief economist, in a statement. “It continues to be a seller’s market, but buyers who remain interested in purchasing a home may find that competition has moderately softened.”
Leading Economic Index
- The outlook for the U.S. economy improved in March despite economic fallout from Russia’s invasion of Ukraine, according to The Conference Board’s Leading Economic Index. The index measures unemployment, manufacturing orders, building permits, stock prices, and other metrics to forecast the direction the economy is headed.
- We’re not out of the woods, though. Rapid price increases for consumer products, widespread supply chain problems, the Fed’s interest rate hikes, and disruptions in global supplies of oil and other important commodities caused by the war in Ukraine all threaten that continued economic growth, Ataman Ozyildirim, senior director of economic research at The Conference Board, said in a statement. Some economists have predicted the U.S. economy is likely to fall into a recession in the next few years because of those factors.
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