FHFA: Home Prices Rise 0.30 Percent in January

FHFA Home Prices Rise 0.30 Percent in JanuaryThe Federal Housing Finance Agency (FHFA) reported that home prices rose by a seasonally-adjusted rate of 0.30 percent in January, and were 5.10 percent higher as compared to home prices in January 2014.

FHFA oversees Fannie Mae and Freddie Mac and its home price report is based on sales of homes financed by mortgages owned or backed by Fannie Mae and Freddie Mac.

Month- to- Month FHFA Home Prices Mixed

Month to month home price data was mixed for January. Home prices ranged from -0.40 percent in the Middle and South Atlantic census divisions to +2.30 percent in the East South Central census division.

Month-to month readings are considered more volatile than year-over-year home price readings. Year-over-year readings for all nine U.S. census divisions were positive and ranged from a 1.70 percent increase in the Middle Atlantic division to an increase of 8.20 percent in the Pacific division. This suggests that overall, home prices are gaining, but slowly.

Commerce Department: New Home Sales Hit 7-Year Peak

In an unrelated report, the Commerce Department reported that February sales of new homes reached a seven-year peak with 539,000 sales of new homes expected on a seasonally-adjusted annual basis. This was significantly higher than the expected reading of 455,000 new home sales and was also higher than the revised reading of 500,000 new home sales in January.

Analysts said that this positive reading may indicate a robust sales for the peak spring and summer home buying season. The reading for new home sales in February was nearly 25 percent higher than for February 2014.

In spite of this good news, analysts cautioned that the new home sales numbers are often volatile, and future revisions could result in lower sales figures for new homes.

With jobs increasing and mortgage rates remaining relatively low, more homebuyers may enter the market and boost home sales. Tight mortgage lending standards remain an obstacle for would-be buyers with less than stellar credit scores.

What’s Ahead For Mortgage Rates This Week – March 16, 2015

What's Ahead For Mortgage Rates This Week March 16 2015Last week’s economic reports included job openings, retail sales, retail sales except automotive, consumer sentiment for March and the usual reports on weekly jobless claims and mortgage rates.

Job Openings Highest in 14 Years

The Labor Department reported that job openings reached their highest level in 14 years in January, and rose by 2.50 percent over December 2014 job openings. On a seasonally adjusted basis, there were five million job openings in January. Job openings rose by 28 percent year-over-year.

Hiring rose by 3.50 percent to 5.24 million, but analysts said that employers continue to have difficulty in finding workers with skills needed to fill their job openings. Winter weather was also mentioned as contributing to lower hiring rates.

Stable full-time employment is a key requirement for qualifying for a home loan. Inconsistent, part-time and self-employment typically make it more difficult to qualify for mortgages in today’s conservative lending environment.

Retail Sales Lower

Retail sales fell by –0.60 percent in February against an expected reading of +0.30 percent and January’s reading of -0.80 percent. This was the third consecutive drop in retail sales volume and suggests that consumers are not confident about spending. Retail sales except automotive were also lower with a February reading of -0.10 percent against an expected reading of +0.40 percent and January’s reading of -1.10 percent.

Mortgage Rates Rise, Weekly Jobless Claims Fall

According to Freddie Mac average mortgage rates rose across the board with the rate for a 30-year fixed rate mortgage at 3.86 percent, an increase of 11 basis points. The average rate for a 15-year mortgage rose by seven basis points to 3.10 percent. The average rate for a 5/1 adjustable rate mortgage rose five basis points to 3.01 percent. Discount points were unchanged at 0.60 percent for fixed rate mortgages and 0.50 percent for a 5/1 adjustable rate mortgage.

Weekly jobless claims fell to 389,000 against expectations of 310,000 new jobless claims filed and the prior week’s reading of 325,000 new claims filed. This was good news after a spike in new jobless claims that was likely caused by bad weather. Although week to week data tends to be more volatile than month-to-month trends, there was good news in that new jobless claims fell below a benchmark of 300,000 new claims filed. Readings of 300,000 or fewer new jobless claims filed represent strong labor market conditions.

What’s Ahead

This week’s economic reports include the NAHB Wells Fargo Housing Market Index, federal reports on housing starts and building permits and the Federal Reserve’s FOMC meeting statement. Fed Chair Janet Yellen is scheduled to present a press conference, which analysts will watch closely for any indication of when the Fed will raise interest rates.

What’s Ahead For Mortgage Rates This Week – March 9, 2015

What's Ahead For Mortgage Rates This Week March 9 2015Last week’s economic news was light on housing related reports, but several employment reports were released along with the national unemployment rate, which dipped to 5.50 percent. This was a full point below the Federal Reserve’s original target rate of 6.50 percent. Construction spending was incrementally lower than expected and mortgage rates also fell.

Fewer Private-Sector Jobs, Non-Farm Payrolls Increase

The ADP employment report for February fell from January’s reading of 250,000 jobs to 212,000 private-sector jobs. January’s reading was upwardly revised from the original tally of 213,000 jobs added. News was better for Non-Farm Payrolls for February. The Labor Department reported that 295,000 jobs were added; analysts expected a reading of 238,000 new jobs based on January’s original reading of 257,000 jobs added, but January’s reading was revised to 239,000 jobs added. The Non-Farm Payrolls report includes both public and private-sector jobs.

Weekly jobless claims rose to 320,000 against expectations of 301,000 new claims and the prior week’s reading of 313,000 new jobless claims. The week-to-week jobless claims report is considered volatile; most analysts base forecasts on a four-week rolling average.

National unemployment decreased from 5.70 percent in January to 5.50 percent in February as compared to an expected reading of 5.60 percent. February’s reading was the lowest since May 2008. Construction added 29,000 in February, which could indicate a boost in home construction. The unemployment rate does not account for 17.50 million workers who work part-time but want full-time work and those who have left the job market. The labor market participation rate fell to 62.8 percent, which was its lowest since the late 1970s.

Analysts said that based on the lower unemployment rate, the Fed may move as soon as June to raise the target federal funds rate to prevent rapid inflation, but Federal Reserve policy makers have consistently cited concerns over labor markets as a reason why the fed funds rate hasn’t been raised. A combination of stagnant wages, higher mortgage rates combined with stubbornly strict mortgage credit requirements could cause housing markets to lag behind other economic sectors until would-be home buyers achieve steady employment and can qualify for home financing.

Mortgage Rates Drop

Freddie Mac provided good news as average mortgage rates dropped.  Last week’s rate for a 30-year mortgage was 3.75 percent and lower by five basis points; the average rate for a 15-year fixed rate mortgage dropped by four basis points to 3.03 percent and the average rate for a 5/1 adjustable rate mortgage was three basis points lower at 2.96 percent. Discount points were unchanged at 0.60 percent for fixed rate mortgages and 0.50 percent for 5/1 adjustable rate mortgages.

What’s Ahead

This week’s economic news includes reports on job openings and labor market conditions along with retail sales reports. Consumer sentiment will be release and Freddie Mac mortgage rates and weekly jobless claims data will be released as usual on Thursday.

FHFA House Price Index Rises for 14th Consecutive Quarter

FHFA House Price Index Rises for 14th Consecutive QuarterAccording to the Federal Housing Finance Agency (FHFA), U.S. home prices rose by 1.40 percent for the fourth quarter of 2014 and were up by 0.80 percent month-to-month from November. The seasonally adjusted FHFA House Price Index measures purchase transactions for homes connected with mortgages owned by Fannie Mae and Freddie Mac.

FHFA also reported that home prices rose 4.9 percent year-over –year from the fourth quarter of 2013 to the fourth quarter of 2014. FHFA Chief Economist Andrew Leventis described the report for the last quarter of 2014 as “relatively strong” and also cited low inventories of available homes and improving labor markets as contributing to home price growth.

FHFA House Price Index Identifies Significant Trends

FHFA’s expanded house price data, which adds data from county records and the Federal Housing Administration, to the FHFA House Price Index, indicated that home prices grew by 1.30 percent in the fourth quarter; year-over-year home prices grew by 6.0 percent according to FHFA’s expanded house price data report.

According to purchase-only indexes for the 100 most populated metro areas, the San Francisco-Redwood City-south San Francisco, California metro area posted the highest rate of year-over-year home price gains at six percent for the fourth quarter of 2015. The lowest reading was for the El Paso, Texas, which posted a loss of 6.60 percent in the fourth quarter.

The mountain division of the nine U.S. Census divisions posted the highest annual home price growth at 5.50 percent and 1.40 percent in the fourth quarter. House price appreciation was weakest in the New England Division, where home prices fell by0.03 percent.

FHFA also reported that its “distress free” home price indexes which the agency publishes for 12 metro areas have shown less price appreciation than the FHFA purchase only Home Price Index. Distress-free means that foreclosed homes and short sales were not included in these index readings.

FHFA has expanded its home price reports with a set of reports based on three-digit zip codes. Sorting house price data by the first three digits of a zip code provides more specific data for regional home price trends; mortgage and real estate pros can find house price data for specific neighborhoods and communities. FHFA described its three-digit zip code reports as “experimental” at present.

 

What’s Ahead For Mortgage Rates This Week – February 23, 2015

What's Ahead For Mortgage Rates This Week Feburary 23 2015

Last week’s housing related reports included the National Association of Home Builders (NAHB) Housing Market Index for February, The Commerce Department’s report on Housing Starts for January and Freddie Mac’s weekly report on average mortgage rates. The Federal Reserve released the minutes of January’s FOMC meeting, which indicated that FOMC members are in no hurry to raise the target federal funds rate. The details:

Home Builder Confidence, Housing Starts Impacted by Winter Weather

The NAHB Housing Market Index for February fell from January’s reading of 57 to 55. Analysts expected a reading of 59. This was the lowest reading since October, but February’s reading remains above the benchmark of 50. Readings exceeding 50 indicate that more home builders are confident about housing market conditions than not.

According to the NAHB, harsh weather contributed to lower builder confidence in February. NAHB Chief Economist David Crowe said that low mortgage rates, increasing affordability and improving job markets are helping home buyers.

The NAHB Housing Market Index is calculated based on three components. Builder confidence dropped by one point to a reading of 61 for current housing market conditions. Not surprisingly, the winter weather caused buyer foot traffic to drop five points to a reading of 39. A gauge of housing market conditions in the next six months was unchanged.

Regional readings showed declines in three of four regions: The Northeast saw a one-point drop to 46; the Midwest and South dropped by two points to readings of 54 and 57. The Western region gained two points for a reading of 68.

The U.S. Commerce Department reported that January’s Housing Starts dropped from 1.09 million in December to 1.07 million in January; the reading for January matched analysts’ expectations.

Weekly jobless claims provided some good news; they dropped from the prior week’s reading of 304,000 new claims to 283,000 new claims. The expected reading was 290,000 new jobless claims.

Mortgage Rates Rise, Points Unchanged

Freddie Mac reported that average mortgage rates rose last week. The rate for a 30-year fixed rate mortgage rose by seven basis points to 3.76 percent; the average rate for a 15-year fixed rate mortgage increased by six basis points to 3.05 percent and the average rate for a 5/1 adjustable rate mortgage was unchanged at 2.97 percent. Discount points were unchanged at 0.6 percent for fixed rate mortgages and 0.50 percent for 5/1 adjustable rate mortgages.

What’s Ahead

Next week’s scheduled economic news includes several reports related to housing. New and existing home sales reports will be released along with the Case-Shiller Composite Housing Market reports. FHFA will release its House Price Index Report and Fed Chair Janet Yellen is set to testify before Congress. Reports on Consumer Sentiment and Consumer Confidence are also scheduled along with weekly reports on jobless claims and mortgage rates.

What’s Ahead For Mortgage Rates This Week – February 9, 2015

Whats Ahead For Mortgage Rates This Week Feburary 9 2015Last week’s economic news included construction spending, which fell shy of expectations but exceeded the prior month’s spending, and several consumer and labor-related reports. The details:

Mortgages More Accessible: Fed Survey

A Federal Reserve survey of senior loan officers at 73 U.S. banks and 23 branches of foreign banks indicated that mortgages may be more accessible. While banks eased credit standards for mortgages eligible for purchase by Fannie Mae and Freddie Mac, consumer demand for mortgages fell over the last three months. This seems puzzling given lower mortgage rates, but mortgage lending rules remain tough for borrowers with less than pristine credit.

Mortgage rates dropped last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage was 3.59 percent with discount points higher at 0.70 percent. The average rate for a 15-year fixed rate mortgage was seven basis points lower at 2.92 percent with discount points higher at 0.60 percent. The average rate for a 5/1 adjustable rate mortgage was four basis points lower at 2.82 percent with discount points unchanged at 0.40 percent.

Lower mortgage rates are great news for home buyers and homeowners seeking to refinance, but only if mortgage loans are available.

Construction Spending Higher, Consumer Spending Drops, Inflation Stalls

According to the Department of Commerce, Construction Spending rose by 0.40 percent in December against November’s reading of -0.20 percent and expectations of 0.70 percent growth. December’s reading represented $981.2 billion in construction spending on a seasonally-adjusted annual basis. Residential construction rose by 0.30 percent.

Consumer spending fell by -0.30 percent and was consistent with analysts’ expectations. This was the highest month-to-month drop in consumer spending since September 2009. Consumers spent less on vehicles and fuel. Lower fuel prices were seen as the driving force behind less consumer spending. Core personal expenditures did not increase in December. Core inflation, which excludes volatile food and energy sectors, was well below the Fed’s target annual inflation rate of 2.00 percent with a reading of 1.30 percent year-over-year.

Labor Reports: Mixed Signals

Weekly jobless claims rose to 278,000 against the prior week’s reading of 267,000 new jobless claims, but claims were lower than the expected reading of 290,000 new jobless claims. Nonfarm payrolls for January were higher in January at 257,000 jobs added. Analysts expected only 230,000 new jobs added in January based on December’s reading of 267,000 jobs added.

ADP Payrolls reported 213,000 private sector jobs added in January against December’s reading of 253,000 private sector jobs added. January’s lower reading is likely based on seasonal hiring during the holiday season. National Unemployment rose from December’s reading of 5.60 percent to 5.70 percent. In recent months national unemployment rates have fallen below the Fed’s target reading of 6.50 percent.

What’s Ahead

This week’s scheduled economic reports include data on retail sales, job openings, labor market conditions and weekly reports on new jobless claims and Freddie Mac’s survey of mortgage rates.

 

What’s Ahead For Mortgage Rates This Week – Feburary 2, 2015

Whats Ahead For Mortgage Rates This Week Feburary 2 2015Last week’s economic reports included Case-Shiller 10 and 20-City Home Price Index reports for November along with new and pending home sales for December. Freddie Mac reported on average mortgage rates and new jobless claims dipped unexpectedly. The details:

Case-Shiller: Home Price Growth Slower in November

Case-Shiller’s 20-City Home Price Index for November indicated that home prices continue to slow across the nation. Seasonally-adjusted annual home price growth slowed to 4.30 percent from October’s reading of 4.50 percent. Slowing momentum in year-over-year home price growth placed downward pressure on month-to-month readings. Several cities, including Atlanta, Georgia, Boston Massachusetts and Cleveland Ohio reported lower home prices in November as compared to October. Chicago, Illinois surprised analysts with a -1.10 percent drop in home price growth for November. Although mortgage rates have fallen in recent weeks, analysts cited tough mortgage approval standards, lower demand for homes and growing inventories of available homes as factors contributing to sluggish housing markets.

New and Pending Home Sales: Mixed Readings

New home sales jumped to a seasonally-adjusted annual reading of 481,000 sales in December against expectations of 455,000 sales and November’s revised reading of 431,000 new homes sold. The original reading for November was 438,000 new homes sold. New home sales were 8.80 percent higher in December year-over-year. The median price of new homes was $298,100 in December, which was an increase of 8.20 percent year-over-year.

Pending home sales reflected sluggish market conditions in December with pending sales lower by -3.70 percent as compared to November’s reading of +0.60 percent. This lull will likely impact completed sales as pending sales generally forecast completed sales within the next 60 days. The National Association of Realtors® said that home prices rose in some areas as supplies dwindled. Fewer homeowners list homes for sale during the fall and winter months than during spring and summer. Analysts also said that home sales trends rely on the willingness of homeowners to list their homes and move up. Although the economy continues to grow, homeowners can impact supplies of available homes if they wait to move up to larger homes.

Mortgage Rates Rise, New Jobless Claims Fall

Freddie Mac reported that average mortgage rates rose last week. The average rate for a 30-year fixed rate mortgage was three basis points higher at 3.66 percent; the average rate for 15-year mortgages rose by five basis points to 2.98 percent, and the average rate for a 5/1 adjustable rate mortgage was 2.86 percent. Discount points fell to 0.60 percent for 30-year mortgages and 0.50 percent for 15-year mortgages. Discount points were unchanged at0.40 percent for 5/1 adjustable rate mortgages.

New jobless claims fell to 265,000; this was lower than the expected reading of 296,000 new jobless claims and the prior week’s reading of 308,000 new jobless claims. Analysts said that the short work week likely contributed to the drop in weekly jobless claims, which was the largest drop in new jobless claims since November 2012. As labor markets improve, more consumers can afford to buy homes. January’s Consumer Confidence Index rose more than expected in January with a reading of 102.9 against expectations of 96.90 and December’s reading of 93.10.

What’s Ahead

This week’s scheduled reports include Construction Spending, Personal Income, Core Inflation, and several employment reports including ADP Payrolls, Non-Farm Payrolls and the national unemployment rate. Freddie Mac’s mortgage rates report and new unemployment claims will be released on Thursday as usual.

What’s Ahead For Mortgage Rates This Week – January 20, 2015

Whats Ahead For Mortgage Rates This Week January 20 2015Last week’s scheduled economic news was mixed. Job openings increased and jobless claims increased, and consumer sentiment rose. Mortgage rates fell across the board. Labor market conditions improved and consumer prices fell in large part due to decreasing fuel prices. The details:

Labor Market Conditions Index Suggests Stronger Economy, Jobless Claims Jump

Positive labor market ratings continued to show evidence of strengthening economic conditions. The Federal Reserve’s Labor Market Conditions Index rose from November’s revised reading of 5.50 to December’s reading of 6.10. This index measures 19 economic indicators and rose well above its median reading of 1.90. November’s reading was the highest since May.

The Fed does not comment on month-to-month readings for this index. Job openings increased from November’s reading of 4.80 million to December’s reading of 5.00 million in according to the federal government.

Weekly Jobless Claims jumped to 316,000 as compared to the expected reading of 295,000 new claims and the prior week’s reading of 297,000 new jobless claims. Analysts said that some volatility in new unemployment claims are expected in the aftermath of the holiday season and noted that the latest reading was the highest since September.

Mortgage Rates, Retail Sales Fall

Freddie Mac reported lower average rates across the board. The average rate for a 30-year fixed rate mortgage fell by seven basis points to 3.66 percent; the average rate for a 15-year fixed rate mortgage also fell seven basis points to 2.98 percent. The average rate for 5/1 adjustable rate mortgages dropped by eight basis points from 2.98 to 2.08 percent.

Discount points for a 30-year fixed rate mortgage were unchanged at 0.60 percent, while average discount points for a 16-year mortgage dropped to 0.50 percent from the prior week’s reading of 0.60 percent. Discount points for 5/1 adjustable rate mortgages averaged 0.40 percent as compared to the prior week’s average of 0.50 percent. Lower mortgage rates help increase affordability and support home purchases by first-time and moderate income homebuyers.

Retail Sales for December dropped by -0.90 percent against expectations of -0.20 percent and November’s reading of +0.40 percent. December’s reading for retail sales except autos was lower by-0.10 percent as expected against November’s reading of +0.40 percent.

Last week ended on a positive note with the January reading for the Consumer Sentiment Index beating the expected reading of 95.0 with a reading of 98.20. December’s reading was 93.60.

What’s Ahead

This week’s economic reports include the National Association of Home Builders (NAHB) Housing Market Index, Housing Starts, The National Association of Realtors® Existing Home Sales report, FHFA Home Prices and Leading Economic Indicators. Freddie Mac’s mortgage rates reports and weekly jobless claims will be released as usual.

 

What’s Ahead For Mortgage Rates This Week – January 20, 2015

Whats Ahead For Mortgage Rates This Week January 20 2015Last week’s scheduled economic news was mixed. Job openings increased and jobless claims increased, and consumer sentiment rose. Mortgage rates fell across the board. Labor market conditions improved and consumer prices fell in large part due to decreasing fuel prices. The details:

Labor Market Conditions Index Suggests Stronger Economy, Jobless Claims Jump

Positive labor market ratings continued to show evidence of strengthening economic conditions. The Federal Reserve’s Labor Market Conditions Index rose from November’s revised reading of 5.50 to December’s reading of 6.10. This index measures 19 economic indicators and rose well above its median reading of 1.90. November’s reading was the highest since May.

The Fed does not comment on month-to-month readings for this index. Job openings increased from November’s reading of 4.80 million to December’s reading of 5.00 million in according to the federal government.

Weekly Jobless Claims jumped to 316,000 as compared to the expected reading of 295,000 new claims and the prior week’s reading of 297,000 new jobless claims. Analysts said that some volatility in new unemployment claims are expected in the aftermath of the holiday season and noted that the latest reading was the highest since September.

Mortgage Rates, Retail Sales Fall

Freddie Mac reported lower average rates across the board. The average rate for a 30-year fixed rate mortgage fell by seven basis points to 3.66 percent; the average rate for a 15-year fixed rate mortgage also fell seven basis points to 2.98 percent. The average rate for 5/1 adjustable rate mortgages dropped by eight basis points from 2.98 to 2.08 percent.

Discount points for a 30-year fixed rate mortgage were unchanged at 0.60 percent, while average discount points for a 16-year mortgage dropped to 0.50 percent from the prior week’s reading of 0.60 percent. Discount points for 5/1 adjustable rate mortgages averaged 0.40 percent as compared to the prior week’s average of 0.50 percent. Lower mortgage rates help increase affordability and support home purchases by first-time and moderate income homebuyers.

Retail Sales for December dropped by -0.90 percent against expectations of -0.20 percent and November’s reading of +0.40 percent. December’s reading for retail sales except autos was lower by-0.10 percent as expected against November’s reading of +0.40 percent.

Last week ended on a positive note with the January reading for the Consumer Sentiment Index beating the expected reading of 95.0 with a reading of 98.20. December’s reading was 93.60.

What’s Ahead

This week’s economic reports include the National Association of Home Builders (NAHB) Housing Market Index, Housing Starts, The National Association of Realtors® Existing Home Sales report, FHFA Home Prices and Leading Economic Indicators. Freddie Mac’s mortgage rates reports and weekly jobless claims will be released as usual.

 

What’s Ahead For Mortgage Rates This Week – January 12, 2015

Whats Ahead For Mortgage Rates This Week January 12 2015Last week’s economic news was dominated by labor reports and FHA’s announcement that it will lower its mortgage insurance premiums in an effort to make homes more affordable for first-time and moderate income home buyers. Mortgage rates fell last week as employment reports showed strengthening job markets. The details:

FHA Lowers Mortgage Insurance Premiums

HUD, the agency that oversees FHA, announced Thursday that it will lower annual mortgage insurance premiums by0.50 percent. The change is expected to become effective toward the end of January; HUD stated in its press release that a Mortgagee Letter outlining the changes will be issued shortly.

FHA borrowers pay for FHA mortgage insurance in two steps; an upfront mortgage insurance premium is charged at loan closing, and also pay an annual mortgage insurance premium that is pro-rated monthly and added to mortgage payments.

FHA’s annual premiums increased five times since 2010 and rose from a rate of 0.55 percent to 1.35 percent. Analysts estimated that the reduction of annual premiums to a rate of 0.85 percent will attract an additional 250,000 borrowers of FHA backed mortgage loans and save borrowers about $900 a year.

The move was applauded by housing industry advocates such as the Mortgage Bankers Association and the National Association of Realtors®, but critics fear that the move could cause a taxpayer bailout if claims on defaulted loans increase.

Under federal law, HUD is required to maintain a specific level of capital reserves for its mortgage insurance program. FHA reserves were depleted during the recession, which caused HUD to raise annual mortgage insurance premiums to replenish its reserves for paying claims on defaulted FHA loans.

Mortgage Rates, Unemployment Rate Drop

Freddie Mac reported that average mortgage rates fell across the board. The rate for a 30-year fixed rate mortgage was 3.73 percent; the average rate for a 15-year fixed rate mortgage was 3.05 percent, a drop of 10 basis points. The average rate for a 5/1 adjustable rate mortgage was 2.98 percent, which was three basis points lower than last week’s average.

Discount points were unchanged at 0.60 percent for 30-year fixed rate mortgages and dropped from 0.60 to 0.50 percent for 15-year mortgages. Discount points were unchanged at 0.50 percent for 5/1 adjustable rate mortgages.

Several labor related reports were released last week. ADP reported that December payrolls for private sector jobs rose by 241,000 jobs in December as compared to November’s reading of 227,000 jobs. The Labor Department’s Nonfarm Payrolls report was lower with a reading of 252,000 jobs added than November’s reading of 353,000 jobs added, but December’s reading exceeded analysts’ expectations of 230,000 jobs added. November’s reading was likely influenced by seasonal hiring.

Weekly jobless claims were lower at 294,000 new claims filed against expectations of 290.000 claims filed and the prior week’s reading of 298,000 new claims filed. The national unemployment rate fell to 5.60 percent against an expected reading of 5.70 percent and November’s reading of 5.80 percent.

While this reading is below the Fed’s target rate of 6.50 percent, the minutes of the Federal Open Market Committee (FOMC) meeting in December indicate that Fed policy makers remain concerned about low inflation rates. Falling oil prices were noted as a primary cause of falling inflation. The FOMC also noted slow improvement in housing markets and again cited tight lending standards as a significant cause.

What’s Ahead

Next week’s scheduled economic news releases include the Consumer Price Index (CPI) and Core CPI, which excludes food and energy. A report on consumer sentiment will also be released in addition to weekly reports on mortgage rates and new jobless claims.