International Trade: The U.S. trade deficit increased by $16 billion to $51.4 billion in March. This is blamed partly on a port worker strike on the West Coast. The dispute was resolved in the middle of the month, and imports were up $17.1 billion as a result. Meanwhile, exports rose $1.6 billion. The goods gap was $70.6 billion, reaching a level not seen since August 2008.
MBA Mortgage Applications: Total applications were down 4.6% this week. Refinances fell 8.0% as the average rate on a 30-year fixed mortgage climbed 7 basis points to 3.92%. Meanwhile, purchases were up 1.0%.
Jobless Claims: Initial claims were up by 3,000, coming in at 265,000. This represents two consecutive weeks of low jobless claims. The four-week average is 279,500, a 15-year low. Continuing claims were also at 15-year lows, down 28,000 to 2.28 million. The four-week average was down 20,000 to 2.72 million, again a 15-year low.
Employment Situation: While 223,000 new jobs were added to nonfarm payrolls this month, analysts considered this a fairly soft number. Meanwhile, March’s gain of 126,000 jobs was revised to 85,000. Private payrolls grew by 213,000 jobs. The consensus had been for a growth of 223,000. Unemployment dropped one tenth to 5.4%. The labor force participation rate came in at 62.8%, and wages went up by 0.1%.
Mortgage rates were mostly up this week as movements in the bond market caused the 10-year treasury to move to a higher yield.
30-year fixed-rate mortgages (FRMs) averaged 3.80% with an average 0.6 point for the week ending May 7, 2015, up from last week when they averaged 3.68%. A year ago at this time, 30-year FRMs averaged 4.21%.
15-year FRMs this week averaged 3.02% with an average 0.6 point, up from last week when they averaged 2.94%. A year ago at this time, 15-year FRMs averaged 3.32%.
5-year Treasury-indexed hybrid adjustable rate mortgages (ARMs) averaged 2.90% this week with an average 0.4 point, up from last week when they averaged 2.85%. A year ago, 5-year ARMs averaged 3.05%.
1-year Treasury-indexed ARMs averaged 2.46% this week with an average 0.4 point, down from last week when they averaged 2.49%. At this time last year, 1-year ARMs averaged 2.43%.
Stocks were up on Friday as the jobs report showed weaker than expected growth, calming fears that the Federal Reserve would soon raise interest rates. The Dow Jones Industrial Average closed Friday at 18,191.11, up 267.05 points on the day and 0.93% for the week. The S&P 500 was at 28.10 points, closing at 2,116.09, a 0.37% weekly gain. The NASDAQ finished Friday at 5,003.55, losing just 0.04% for the week after gaining 58 points Friday.
The Week Ahead
Tuesday, May 12
Quicken Loans HPPI/HVI (10:00 a.m. ET) – Quicken Loans, the second largest retail mortgage lender in the U.S., releases a monthly report on home values as well as the difference between homeowner perception of value versus appraiser opinion of value.
Wednesday, May 13
MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Retail Sales (8:30 a.m. ET) – Retail sales measure the total receipts at stores that sell merchandise and related services to final consumers. Sales are measured by retail and food services stores. Data is collected from the Monthly Retail Trade Survey conducted by the U.S. Census Bureau.
Thursday, May 14
Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time.
Producer Price Index (PPI) (8:30 a.m. ET) – The Producer Price Index measures the average change over time in the prices received by domestic producers of goods and services.
Friday, May 15
Industrial Production (9:15 a.m. ET) – The Federal Reserve’s monthly index of industrial production and the related capacity indexes and capacity utilization rates covers manufacturing, mining and electric and gas utilities.
Consumer Sentiment (9:55 a.m. ET) – The University of Michigan’s Consumer Survey Center questions 500 households each month on their financial conditions and attitudes about the economy. Consumer sentiment is directly related to the strength of consumer spending.
Visit the Quicken Loans Zing Blog for updated information on important economic releases that affect your wallet.
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