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Producer Price Index (PPI): Production prices were down 0.2% in February. Prices are flat year to year. They’re also unchanged when you take out food and energy. Despite being flat in February, taking out food and energy reveals that prices are up 1.2% for the year. Taking it one step further and removing trade services, prices rose 0.1% for the month and are up 0.9% on the year. Demand for services is especially weak. Service pricing has only gone up 1.5% since this time last year. Energy prices were down 3.4% in February. The cost of vegetables was down 19.0% following a 17.0% gain in the previous two months.

Retail Sales: It was a bad month for retail in February. Not only did February sales come in down 0.1%, but January numbers were revised down from 0.2% to -0.4%. The February number was unchanged when you take out cars, but low oil prices are definitely contributing to the downturn. When you take out cars and gas, prices rose 0.3%. Vehicle sales are up 6.8% on the year and restaurants are up 6.4%. Other key categories for annual growth include building materials and garden equipment, up 12.2%, and sporting goods, which is up 6.7%. Although sporting goods is a small category, it’s an interesting one to look at because if people are spending on sporting goods, they have likely upped discretionary spending. On the downside, electronics and appliance sales are down 3.2% for the year and department stores are down 2.2%. Gasoline sales are down 15.6% due to low prices at the pump.

Housing Market Index: This index from the National Association of Home Builders came in unchanged in March at 58. There’s lots of demand for new homes, but it’s not being matched by appropriate levels of construction labor and available lots. Present sales are unchanged at 65. Meanwhile, there was a slight negative in the fact that future sales were down three points to 61. On the upside, there was a four point gain in traffic of prospective buyers through new houses bringing the measure to 43.

MBA Mortgage Applications: Applications were down 3.3% last week as the average rate on a 30-year conforming mortgage was up five basis points to 3.94%. Refinances were down 6.0%. Purchases were up 0.6% and are up 33% on the year.

Consumer Price Index (CPI): Prices were down 0.2% in the month of February. They’re still up 1.0% year-over-year. Energy prices had a lot to do with the drop as they were down 6.0%. When you take out food and energy prices, prices were up 0.3% and 2.3% on the year. Turning to individual categories, the cost of medical care was up 0.5% this month as prescription drug costs were up 0.9%. Shelter was up 0.3% and apparel was up 1.6% in a big gain. Food rose 0.2% and is up 0.9% on the year.

Housing Starts: Starts were way up, gaining 5.2% to 1.178 million. There was a 7.2% gain for a single-family homes and a 0.8% gain for multi-family homes. Permits were much weaker, down 3.1% to 1.167 million. There was an 8.4% drop in the number of multi-family permits to 436,000. Single-family permits were up 0.4% to 731,000. Regional data for permits showed the Northeast with a 36% gain and the South down 1.8%. The West, a key indicator for new housing, was up 6.5%.

Industrial Production: Production was down 0.5% and capacity utilization was down 0.4% to 76.7%. However, manufacturing came in slightly higher than expected, up 0.2%. Utilities were down 4.0% in February, reflecting warmer weather and a drop in demand for heat. Mining is also down 1.4%. Although vehicle manufacturing went down 0.1%, demand for business equipment picked up the slack as it was up 0.6%.

Jobless Claims: Initial claims were up 7,000 this week to come in at 265,000. The four-week average was up just 750 jobs to 268,000. Meanwhile, on the continuing claims side, they were up just 8,000 to 2.235 million. Meanwhile, the four-week average is down 10,000 to 2.243 million.

Consumer Sentiment: Consumer sentiment fell 1.7 points to come in at 90.0. The public is the least optimistic it’s been since October. Expectations are down 1.9 points to come in at 80.0. Consumers have less confidence in the job market and increasing incomes. Consumers also have less faith in the current job market as current conditions are down 1.2 points to 105.6. Inflation expectations are 0.2% higher for both the one-year and five-year consumer projections. Both come in at 2.7%.

Mortgage News

Mortgage rates moved up last week.

30-year fixed-rate mortgages (FRMs) averaged 3.73% with an average 0.5 point for the week ending March 17, 2016, up from last week when they averaged 3.68%. A year ago at this time, 30-year FRMs averaged 3.78%.

15-year FRMs this week averaged 2.99% with an average 0.4 point, up from last week when they averaged 2.96%. A year ago at this time, 15-year FRMs averaged 3.06%.

5-year Treasury-indexed hybrid adjustable rate mortgage (ARMs) averaged 2.93% this week with an average 0.5 point, up from last week when they averaged 2.92%. A year ago, 5-year ARMs averaged 2.97%.

Stock Market

The nation’s major stock indexes all had a positive week following the Federal Reserve’s decision to keep interest rates where they stood.

The Dow Jones Industrial Average was up 120.81 points Friday to close at 17,602.30, up 2.26% for the week. Meanwhile, the S&P 500 was up 8.97 points, finishing at 2,049.56. It was up 1.35% since last Friday’s close. The NASDAQ rose 20.66 points to 4,795.65 for a week-over-week gain of 0.99%.

The Week Ahead

Monday, March 21

Existing Home Sales (10:00 a.m. ET) – Existing Home Sales tallies the number of previously constructed homes, condominiums and co-ops in which a sale closed during the month. Existing homes (also known as home resales) account for a larger share of the market than new homes, and indicate housing market trends.

Tuesday, March 22

FHFA House Price Index (9:00 a.m. ET) – The Federal Housing Finance Agency (FHFA) House Price Index (HPI) covers single-family housing using data provided by Fannie Mae and Freddie Mac. The HPI is derived from transactions involving conforming conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac.

Wednesday, March 23

MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications to mortgage lenders. This is a leading indicator for single-family home sales and housing construction.

New Home Sales (10:00 a.m. ET) – New home sales measure the number of newly constructed homes with a committed sale during the month.

Thursday, March 24

Durable Goods Orders (8:30 a.m. ET) – Durable goods orders are based on new orders placed with domestic manufacturers for factory hard goods.

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. An increasing trend suggests a deteriorating labor market. The four-week moving average of new claims smooths out weekly volatility.

Friday, March 25

GDP (8:30 a.m. ET) – This measures the monetary value of all final goods and services produced within the U.S. This report is released on a quarterly basis.

The stock market is closed in observance of Good Friday.

It looks like a fair amount of activity is headed this way next week. Subscribe to the Zing Blog for all of the important economic and mortgage news you can handle. We’re so much more than that, though. We’ve got all kinds of tips for your home, money and life.

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