Overview: Over the past week, mixed economic data caused some volatility for mortgage markets. The price movements were roughly offsetting, however, and rates ended with little change, ahead of key inflation and labor market reports over the next two days.
The Job Openings and Labor Turnover Survey (JOLTS) report data released on Tuesday suggested looser conditions in the labor market. At the end of September, there were 7.4 million job openings, far below the consensus forecast of 8 million and the lowest level since January 2021. This equates to fewer than 1.1 openings for each available worker, down from a peak of over 2 in early 2022, and in line with the levels seen prior to the pandemic. A lower number of openings suggests that companies face less pressure to raise wages to hire enough workers, so this positive news on inflation was favorable for mortgage rates.
Gross domestic product (GDP) is the broadest measure of economic activity. During the third quarter of 2024, U.S. GDP rose at an annualized rate of 2.8%, below the consensus forecast of 3% and down from 3% during the second quarter. Strength was seen in consumer spending and government spending. The core inflation component of the report remained a little above the Federal Reserve’s target of 2%.
The Consumer Confidence Index published by the Conference Board jumped to 108.7, far above the consensus forecast of just 99.5 and the highest level in nine months. Improved perceptions about labor market conditions were responsible for most of the increase, while consumers did not express much concern about the election. Plans to purchase big-ticket items such as autos and major appliances also rose significantly.
In the housing sector, sales of new homes in September increased 4% from August and were 6% higher than a year ago. The median new-home price of $426,300 was up slightly from last year at this time. In contrast to existing-home sales, which measure closings during the month, new-home sales are based on contracts signed, so they are a leading indicator of future housing market activity.
Job Openings (millions)
Week Ahead
Oct. 31
Personal Income and Outlays Personal Consumption Expenditures (PCE) Price Index
Nov. 1
Employment Report
Institute for Supply Management (ISM) Manufacturing Index
Nov. 5
Institute for Supply Management (ISM) Services Index
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