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US Mortgage Applications Rise

James Boston
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US Mortgage Applications Rise

The US Mortgage Bankers Association (MBA) have announced a slight increase in Mortgage Applications for the week ended 11th August. The rate of applications has picked up by 1.4% following a fall of -2.7% the previous week, all expectations were for no change in the rate this week. Additionally, the MBA has announced a slight decrease in the 30 Year Mortgage rate, this currently stands at 4.29% from 4.35% the week previous.

US markets are anticipating two key events during the remainder of this week. Firstly, the publication of the minutes of the Federal Open Market Committee (FOMC) meeting that was held at the end of July are due this evening. Naturally these minutes will be scrutinized for any information as to when the Fed might seek to tighten up on US interest rates, voting dissention will be particularly looked for today in light of this morning’s breaking ranks in the Bank of England. It is however already known that the FOMC contains a minority of members in favour of immediate rate hikes so really the pertinent clues will come in the form of any softening of a commitment to hiking rates from these members.

The main event to watch will be the Fed Chair, Janet Yellen’s, speech at the Jackson Hole Symposium on Friday. This meeting of Central Bank officials is often used as a podium to either explicitly or implicitly announce alterations to forward guidance from the respective monetary authorities. Yellen’s keynote address is to focus on labour markets, and this will be of particular interest to Fed watchers as despite falling US unemployment levels this topic has long been her stated reason for maintaining the Federal Reserve’s ‘accommodative’ stance on interest rates. Structural change in the US employment market is masking some of the slack which is holding back wage inflation.

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