With the CPI and PPI scheduled for release in the upcoming week, the previous week was lightly peppered with a small amount of impactful financial data releases. The highlight was the S&P Manufacturing PMI, which reported final numbers for the year showing better-than-expected improvements in the manufacturing sector. Unemployment data also aligned with expectations, reinforcing the likelihood of a Federal Reserve rate cut remaining on track. Lastly, the Consumer Credit Report had the expected jump just before the Holiday Season as consumers relied on credit to make holiday purchases for the end of the year.
S&P PMI Final
Input cost inflation slowed further, reaching its lowest rate in a year. Meanwhile, output prices increased at a slightly faster pace. The seasonally adjusted S&P PMI stayed below the neutral 50.0 mark, recording 49.7, which indicates only a slight decline in the sector’s health for the month. This was an improvement from October’s 48.5 reading and marked the highest level in the current five-month trend of weakening business conditions.
Unemployment Report
The economy added a seemingly solid 227,000 new jobs in November, but much of the gain was tied to temporary influences instead of resurgence in weakening U.S. labor market. The rebound in hiring followed a paltry 36,000 increase in new jobs in October, when a strike at Boeing and a pair of major hurricanes depressed employment.
Consumer Credit
Total U.S. consumer credit surged in October, rising by $19.2 billion compared to a $3.2 billion gain in the prior month, the Federal Reserve said Friday. This marked the fastest growth since July, reflecting a 4.5% annualized growth rate, up significantly from the 0.8% increase in the previous month.
Primary Mortgage Market Survey Index
• 15-Yr FRM rates saw a decrease of -0.14% with the current rate at 5.96%
• 30-Yr FRM rates saw a decrease of -0.12% with the current rate at 6.69%
MND Rate Index
• 30-Yr FHA rates saw a decrease of -0.10% for this week. Current rates at 6.12%
• 30-Yr VA rates saw a decrease of -0.11% for this week. Current rates at 6.13%
Jobless Claims
Initial Claims were reported to be 224,000 compared to the expected claims of 215,000. The prior week landed at 215,000.
What’s Ahead
A light week, with the largest reports being the Consumer Price Index and Price Producer Index. These have historically been the most impactful reports for inflation.