July 2, 2024
In the interest of seeing lower interest rates, we have had some hits and misses in the past few months. Two months ago, we had a moderate jobs report, but stronger than expected inflation numbers. Last month we had a strong jobs report but weaker than expected inflation numbers. Thus, we now are asking if it is possible for the economy to deliver a moderate gain in jobs and another positive inflation report – all in the same month.
The Fed meets at the end of the month, and they will be watching both of these factors carefully. After this month, they don’t meet again until the end of September. Thus, we are running out of time in order for the Fed to lower rates before the year starts to come to a close. Having two good inflation reports together with two out of three moderate job reports could put a rate decrease at least on the table.
There is no doubt that the economy is slowing down. As of yet, we have not seen signs of the recession that economists were predicting for last year. Most are calling this a soft landing. What we are trying to avoid is the term “stagflation.” During stagflation, the economy stagnates while inflation still rages. Certainly, we don’t feel that inflation is raging at this point, but it would be nice if inflation has cooled to the point that the Fed is comfortable loosening up a bit to avoid a further slowdown. We know that those looking to purchase homes would greatly appreciate mortgage rates easing a bit more. Come on July—let’s do a “two-fer.”
Source: Origination Pro
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