Blog posted On February 15, 2019
The job market continues to fire on all cylinders, with the Labor Department reporting an increase in job openings, up to 7.53 million in December. New purchase mortgage application submissions fell and refinance application submissions were almost unchanged. The consumer price index increased year-over-year but was unchanged month-over-month as inflation cools.
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) showed job openings reached 7.34 million, the highest level since 2000. The figure also exceeds the 6.5 million Americans who were classified as unemployed, showing there are more open positions than workers available. The quit rate was unchanged at 2.6%.
The Mortgage Bankers Association (MBA) weekly mortgage application survey declined for the week ending 2/8. New purchase application submissions were down 6.0% and refinance application submission were down 0.1% for a composite decrease of 3.7%. Joel Kan, MBA's associate vice president of industry surveys and forecasts, is positive about the housing market’s outlook however, commenting, "Despite the recent decline in applications, we still expect that the continued strength of the job market and lower rates will support more purchase activity in the coming months."
The consumer price index was unchanged month-over-month but up 1.6% from January 2018. Core CPI, excluding more volatile food and energy costs, was up 0.2% month-over-month and 2.2% year-over-year. The smaller gain suggests inflation may be starting to cool down, supportive of the Federal Reserve’s comments on slowing down rate hikes.
The slowdown in inflation may give some consumers a much-needed break in terms of rising expenses. Job openings are abundant and inflation-adjusted wages are up 0.2% month-over-month and 1.7% year-over-year. With incomes up and jobs available, the stage is set for a busy spring home buying and selling season.