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☆ Fed meeting June 2023: The Fed holds rates steady, pausing its rate-hiking campaign
▼ + stars: | 2023-06-14 | by ( Bryan Mena | ) edition.cnn.com time to read: +2 min

The vote to skip a rate increase this meeting was unanimous. “Holding the target range steady at this meeting allows the Committee to assess additional information and its implications for monetary policy,” the statement said. Future policy moves depend on what economic indicators show in the coming weeks and months, including the resilient job market. Most officials in the Federal Open Market Committee, which sets monetary policy, expect the unemployment rate to rise to a range of 4-4.1% this year. “Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring and inflation,” according to the statement.

Persons: Banks Organizations: DC CNN, Federal Reserve, Fed, “, Market Committee, ” Locations: Washington

☆ Global manufacturing is sputtering
▼ + stars: | 2023-06-11 | by ( Bryan Mena | ) edition.cnn.com time to read: +8 min

S&P Global data showed that the US manufacturing sector fell into contraction territory in May. Business conditions in China’s manufacturing industry, the largest in the world, improved in May, according to the Caixin manufacturing Purchasing Managers’ Index. Globally, manufacturers’ optimism fell to its lowest level since December, according to the JPMorgan Global Manufacturing PMI. The possibility of China reinvigorating global economic growth is slipping. That could eventually lead to global manufacturers trimming their workforces if demand for goods continues to weaken and their backlogs shrink further.

Persons: ”, Ariane Curtis, “ We’ve, Tom Garretson, Jerome Powell, hasn’t, won’t bode, Liu Young, Monish Patolawala Organizations: DC CNN — Manufacturers, Factories, P, Institute for Supply Management, Commerce Department, JPMorgan Global Manufacturing PMI, Capital Economics, International Monetary Fund, RBC Wealth Management, Credit Suisse, UBS, The Federal Reserve, European Central Bank, Fed, Apple, 3M, National Association of Manufacturers Locations: Washington, United States, Ireland, China, Europe, Germany, Europe’s

☆ Middle-income buyers face the most severe housing shortage
▼ + stars: | 2023-06-08 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

These would-be buyers face the most severe housing shortage of any other income bracket, according to a new analysis from the National Association of Realtors and Realtor.com that found the market is short more than 300,000 affordable homes for these buyers. Given that income, these buyers can purchase homes valued up to $256,000 without being overburdened with housing costs. Middle-income buyers can afford to buy less than a quarter — only 23% — of listings that are currently on the market. In a balanced market, buyers earning $75,000 can afford to purchase 66% of the listings in the Youngstown metro area. However, these buyers would be able to afford to buy more than 50% of the listings in a balanced market.

Persons: ”, Nadia Evangelou, that’s, ” Evangelou, “ It’s, Toledo —, Danielle Hale, “ Organizations: DC CNN, National Association of Realtors, NAR, El, homeownership Locations: Washington, United States, homeownership, Ohio, — Youngstown , Akron, Toledo, Youngstown, El Paso , Texas, Boise , Idaho, Spokane , Washington, In Boise, Boise

☆ Manhattan rents up 10% from a year ago
▼ + stars: | 2023-06-08 | by ( Anna Bahney | ) edition.cnn.com time to read: +3 min

While rents are cooling in some parts of the United States, the cost to rent a Manhattan apartment hit a record high in May for the third month in a row. That’s up 10% from a year ago and up 3.6% from April, when rents were at a record high of $4,241. Over the past 18 months, rents have been consistently near or breaking record highs in Manhattan, said Jonathan Miller, president and CEO of Miller Samuel. A one-bedroom apartment had a median rent of $4,275 in May, up 7% from last year, while a two-bedroom apartment had a median rent of $5,400, up 8% from a year ago. For those looking for an apartment in New York City, expect more record high rents ahead.

Persons: Douglas Elliman, Miller Samuel, That’s, Jonathan Miller, “, ” Miller, —, Miller, ” Organizations: DC CNN, Federal Reserve, Brooklyn Locations: Washington, United States, Manhattan, Brooklyn, Queens, New York City

☆ Mortgage rates fall for the first time in three weeks
▼ + stars: | 2023-06-08 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

Washington, DC CNN —Mortgage rates dropped this week after a three-week climb, as rates remain volatile amid conflicting economic indicators. Mortgage rates topped 5% for the first time since 2011 a little more than a year ago and have remained over 5% for all but one week during the past year. The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country. Mortgage rates tend to track the yield on 10-year US Treasuries, which move based on a combination of anticipation about the Fed’s actions, what the Fed actually does and investors’ reactions. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow.

Persons: Freddie Mac, ”, Sam Khater, Freddie Mac’s, Jiayi Xu, Xu, ” Xu, Bob Broeksmit, “ Organizations: DC CNN —, Fed, Federal, Treasury, ”, Mortgage, Association Locations: Washington

☆ US venture capital titan Sequoia to split off China business amid tension with Beijing
▼ + stars: | 2023-06-06 | by ( Bryan Mena | ) edition.cnn.com time to read: +3 min

Washington, DC CNN —Venture capital titan Sequoia is splitting its business into three independent partnerships, each with separate brands. Sequoia Capital executives briefed investors Tuesday about the plans, which are expected to be completed by March 2024. The firm’s operations in Europe and the United States will retain the current name, Sequoia Capital. Its Chinese unit, Sequoia China, will use its current Chinese name, HongShan. The company’s business operations in India and Southeast Asia will be spun off into a partnership named Peak XV Partners.

Persons: hyping, Roelof Botha, Neil Shen, Shailendra Singh, Biden, TikTok Organizations: DC CNN — Venture, Sequoia Capital, XV Partners, Apple, Sequoia, Republicans, US, Street Journal Locations: Washington, China, Beijing, Europe, United States, Sequoia China, India, Southeast Asia, Montana

☆ Commercial and multifamily mortgage delinquencies rose in the first part of 2023
▼ + stars: | 2023-06-02 | by ( Anna Bahney | ) edition.cnn.com time to read: +3 min

Washington, DC CNN —Commercial and multifamily mortgage delinquencies increased in the first quarter of 2023, according to a new report from the Mortgage Bankers Association. “Ongoing stress caused by higher interest rates, uncertainty around property values, and questions about fundamentals in some property markets are beginning to show up in commercial mortgage delinquency rates,” said Jamie Woodwell, MBA’s head of commercial real estate research. Freddie Mac had a delinquency rate of 0.13%, an increase of 0.01 percentage points from the fourth quarter of 2022. Commercial mortgage-backed securities had a delinquency rate of 3%, an increase of 0.10 percentage points from the end of 2022. The FDIC delinquency rates for bank and thrift held mortgages reported here do include loans backed by owner-occupied commercial properties.

Persons: ”, Jamie Woodwell, ” Woodwell, Fannie Mae, Freddie Mac, Banks, thrifts Organizations: DC CNN —, Mortgage, Association, Federal Reserve Locations: Washington

☆ The job market held up in May. But the Fed may have already decided to pause
▼ + stars: | 2023-06-02 | by ( Bryan Mena | ) edition.cnn.com time to read: +8 min

Washington, DC CNN —The US labor market picked up momentum in May, once again defying expectations of a slowdown. Many economists, including those at the Fed, still expect a recession later in the year. The labor market and signs of future disinflationThe May jobs report mostly showed that the labor market held up. Some top economists have argued that the strong labor market has had a minor, albeit growing, impact on inflation. Hawkish Fed officials still think the Fed’s job isn’t done.

Persons: That’s, Joe Biden’s, ”, Philip Jefferson, Patrick Harker, “, ” Harker, It’s, ” Julia Pollak, ZipRecruiter’s, you’ve, you’d, Dave Gilbertson, hasn’t, Ben Bernanke, ” Jack Macdowell, Louis President James Bullard, Bullard, Louis Fed’s, Louis, Jerome Powell, there’s, Ian Shepherdson, Eugenio Alemán, Raymond James Organizations: DC CNN, Federal, Fed, Federal Reserve Bank of Philadelphia, National Association for Business Economics, CNN, Employers, of Labor Statistics, BLS, UKG, The Palisades Group, Hawkish Fed, Federal Reserve Bank of St, Louis Fed, Pantheon Locations: Washington, Washington ,

☆ Debt ceiling deal won’t have much impact on the US economy, analysts say
▼ + stars: | 2023-05-31 | by ( Bryan Mena | ) edition.cnn.com time to read: +5 min

The US economy is the world’s largest, so the relatively modest effects on growth could be good news for investors who feared the debt ceiling crisis could have posed a greater and more widespread drag. Here’s what’s in the proposed deal and how it would show up in the broader economy. What’s in the debt ceiling dealThe deal would suspend the federal government’s $31.4 trillion debt limit through January 2025. The debt deal and GDPEconomists at Goldman Sachs expect the deal to reduce federal spending by as much as 0.2% of gross domestic product per year over the two years of the deal, compared with their baseline estimate. “Getting this uncertainty out of the way for markets and decision makers has a real impact,” said Mike Skordeles, head of US economics at Truist Advisory Services.

Persons: Joe Biden, Mark Zandi, Biden, Goldman Sachs, ” Goldman Sachs, Ian Shepherdson, Gregory Daco, ”, Mike Skordeles, Zandi, ” Michael Reynolds Organizations: DC CNN, House Republicans, Moody’s, CNN, Internal Revenue Service, Congressional, Pantheon, Bureau of Labor Statistics, Truist Advisory Services, Investment, “ Locations: Washington, West Virginia

☆ US home prices rose in March for the second month in a row
▼ + stars: | 2023-05-30 | by ( Anna Bahney | ) edition.cnn.com time to read: +5 min

Washington, DC CNN —US home prices rose slightly in March, showing a continuing recovery, according to the latest S&P CoreLogic Case-Shiller US National Home Price Index, released Tuesday. It’s the second month in a row that prices have increased, after an increase in February that snapped a seven-month streak of month-over-month declines. Home prices went up 0.7% in March from the year before, down from 2.1% in the previous month. “The farther west we look, the weaker prices are.”Miami continued to have the largest year-over-year price growth for the eighth consecutive month with a 7.7% increase. Still, “the housing market is likely to remain relatively tense until either home prices or mortgage rates fall enough to bring balance via both buyer and seller activity.”

☆ US mortgage giants were placed on credit watch. Here’s what that means for home buyers
▼ + stars: | 2023-05-26 | by ( Anna Bahney | ) edition.cnn.com time to read: +5 min

Washington, DC CNN —The credit ratings of US mortgage giants Freddie Mac and Fannie Mae were put on watch for possible downgrade by Fitch Ratings late Thursday. The warning came because the ratings for Fannie Mae and Freddie Mac are linked to the sovereign rating of the United States. The aim of Freddie and Fannie is to provide liquidity into the mortgage market and enable a reliable flow of affordable funds to mortgage lenders. “The housing GSEs continue to benefit from meaningful financial support from the U.S. government,” the Fitch statement said. “While politics are at play, the ratings watch is a just that — a watch,” she said.

☆ Former Fed Chair Bernanke argues economy must slow further to bring down inflation
▼ + stars: | 2023-05-23 | by ( Bryan Mena | ) edition.cnn.com time to read: +4 min

Inflation has cooled in the past several months, according to the Fed’s preferred inflation gauge and the Consumer Price Index, though some Fed officials have said that it’s not cooling fast enough. Indeed, the labor market remains on strong footing. “Overheating in the labor market has played a minor role but an increasing one over time. Overall inflation crept up throughout that year, then the Fed began to raise interest rates in March 2022 from near zero. Despite the failures of three regional banks since March, the Fed still raised interest rates two more times during that period.

Persons: Ben Bernanke, ” Bernanke, Olivier Blanchard, Blanchard, they’re, Mary Daly, ” Daly, isn’t Organizations: DC CNN, Former Federal, Fed, International Monetary Fund, Brookings Institution, Federal Reserve Bank of San Locations: Washington, Washington ,, Federal Reserve Bank of San Francisco

☆ US cities with military bases risk economic damage in debt ceiling fight
▼ + stars: | 2023-05-20 | by ( Bryan Mena | ) edition.cnn.com time to read: +5 min

Washington, DC CNN —The United States could default on its debt in less than two weeks, and cities with a large military presence risk an economic firestorm if lawmakers don’t act. About a sixth of government spending goes toward national defense, a quarter of which is to pay military personnel, according to the Congressional Budget Office. If the United States can’t pay its national defense bills, cities with large military bases face a potentially massive fallout, encompassing missed payments, rising debt and a significant pullback in spending that would cut into local businesses’ bottom lines. That could further damage local economies grappling with financial market turbulence that could unfold even ahead of a possible default. Federal workers could get stuck pulling from their savings accounts or relying on credit to make everyday purchases, Mayo said.

☆ Federal Reserve officials are growing skeptical over suspending rate hikes
▼ + stars: | 2023-05-19 | by ( Bryan Mena | ) edition.cnn.com time to read: +7 min

Some officials are concerned inflation isn’t cooling fast enough, which could prompt an 11th consecutive rate hike when policymakers meet in June. Federal Reserve Board Chair Jerome Powell and former Federal Reserve Board Chair Ben Bernanke (R) participate in a discussion at the Federal Reserve Board building in Washington, DC, May 19, 2023. Saul Loeb/AFP/Getty ImagesEarlier this month, Fed officials voted unanimously to raise the benchmark lending rate by a quarter point to a range of 5-5.25%, while signaling a possible pause ahead. Of course, Fed officials’ thinking on monetary policy could drastically change if the United States defaults on its debt, which could happen as soon as June 1. Fed officials always mention that their views on interest rates largely depend on what economic indicators show, resisting taking an absolute stance on how they will vote.

☆ Manhattan rents reach (another) record high
▼ + stars: | 2023-05-18 | by ( Anna Bahney | ) edition.cnn.com time to read: +2 min

Washington, DC CNN —While rents are cooling in some parts of the United States, the cost to rent a Manhattan apartment hit a record high for the second month in a row. That’s up 8% from a year ago and up 1.6% from March, when rents hit a record high of $4,175. A one-bedroom apartment had a median rent of $4,200, up 5% from last year; while a two-bedroom apartment had a median rent of $5,500, up 11% from a year ago. The Manhattan rental market is continuing to trend slightly better than sideways, said Jonathan Miller, president and CEO of Miller Samuel. Not only are median rental prices going up, but the amount of concessions — or incentives offered by landlords — are dropping.

☆ US home prices fall by most in 11 years but sales are down
▼ + stars: | 2023-05-18 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

Sales had shown some life, rising in February after a full year of declines due to surging mortgage rates, but that momentum has since cooled. Annually, sales were down 23% from a year ago and the seasonally adjusted annualized sales pace dropped from 5.57 million units a year ago to 4.28 million in April. Mortgage rates were rising in February and pushing toward 7% in March when many of these April closings went into contract. But the current sales pace is down 33% from the cyclical peak of a 6.34 million unit pace in January 2022. In the South prices were down 0.6% to $357,900 and in the West prices have fallen 8% from a year ago to $578,200.

☆ New home construction rose in April after a dip in March
▼ + stars: | 2023-05-17 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

However, housing starts, a measure of new home construction, were down 22.3% from a year ago, according to data released Wednesday by the Census Bureau. After surging in February following five consecutive months of falling, housing starts fell in March. Single‐family housing starts in April rose 1.6% from the revised March figure, at a seasonally adjusted annual rate of 833,000. Building permits, which track the number of new housing units granted permits, fell in April after also dropping in March. Building permits were down in the Northeast and Midwest, but climbed in the South and West.

☆ Americans are setting vacation records and splurging at bars, restaurants and hotels
▼ + stars: | 2023-05-15 | by ( Bryan Mena | ) edition.cnn.com time to read: +7 min

This expected strength in leisure spending means big business for an industry that was on its knees just three years ago. When the pandemic began, restaurants, bars and hotels were hard hit, shedding more than 8 million jobs in the first few months of 2020. A recent survey from Bank of America showed that 68% of Americans plan to take a vacation this year. Vacationing remained elevated in April with 2.7 million Americans not at work because they were on vacation, the highest level for that month since 2017. Leisure spending is usually first on the chopping block because of its discretionary nature.

☆ American consumers are growing worried about a US debt default
▼ + stars: | 2023-05-12 | by ( Bryan Mena | ) edition.cnn.com time to read: +4 min

“If policymakers fail to resolve the debt ceiling crisis, these dismal views over the economy will exacerbate the dire economic consequences of default.”The latest survey showed that the university’s consumer-sentiment index fell by 9% in May. Monthly household spending growth tumbled to 5.4% from a revised 7.1% in December, according to the New York Fed’s Household Spending Survey, which is fielded every four months. Michigan’s report showed US household spending was flat in March from the prior month, after limping just 0.1% in February. Stack on top of that the Federal Reserve’s punishing interest-rate increases and still-high inflation, and consumers might just tap out. The Conference Board’s sentiment survey showed that consumer confidence worsened in April as Americans became more worried about the jobs market.

☆ Mortgage rates tick down for the second week in a row
▼ + stars: | 2023-05-11 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

Washington, DC CNN —Mortgage rates ticked down last week for the second week in a row, as progress on inflation is keeping rates calmer. “This week’s decrease continues a recent sideways trend in mortgage rates, which is a welcome departure from the record increases of last year,” said Sam Khater, Freddie Mac’s chief economist. Mortgage rates topped 5% for the first time since 2011 a little more than a year ago, and have remained over 5% for all but one week during the past year. But over the last month rates have averaged about 6.37% and have been going up and down, but staying under 6.5%. “This should bode well for the trajectory of mortgage rates over the long term.”The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country.

☆ Home buying costs could spike by 22% if US defaults on its debt
▼ + stars: | 2023-05-11 | by ( Anna Bahney | ) edition.cnn.com time to read: +5 min

Housing costs would spike by 22% with the rate for 30-year, fixed rate mortgages rising above 8%. “While we don’t expect a debt default to occur, if it did, it would have unprecedented effects on the financial system,” said Jeff Tucker, a senior economist at Zillow. If there were to be a debt default, the biggest projected deficit would come in September, with an estimated 23% fewer existing home sales. Mortgage rates tend to follow yields on 10 year Treasury bonds and would likely rise, too. “It is a looming risk about a month away, so it isn’t yet wreaking havoc on 30-year mortgage rates.

☆ This house just got 25 offers. But, yes, the market is still cooling
▼ + stars: | 2023-05-09 | by ( Anna Bahney | ) edition.cnn.com time to read: +7 min

Within 48 hours the sellers were in contract with a buyer offering well over the asking price. Even though fewer people are buying homes now than a year ago, “we still have more buyers in the market than we have inventory. But it isn’t 2021, mortgage rates are now over 6%. In Rye, New York, she said, one property sold for $600,000 over the asking price. That home ultimately sold for $75,000 over the asking price.

☆ Will wages outpace inflation for long? It depends on the job
▼ + stars: | 2023-05-05 | by ( Bryan Mena | ) edition.cnn.com time to read: +6 min

Washington, DC CNN —Wages are now finally beating inflation, according to the latest quarterly data on wage growth. That was the biggest monthly increase since March 2022, though wage growth had gradually slowed since then. “The folks who left one company and went to another are the ones who are still benefiting from wage growth,” said Morgan Llewellyn, chief data scientist at Jobvite. Part of the continued strength in wage growth largely has to do with employers’ difficulty in hiring, which varies by industry. “Wage growth has still been higher for job changers than job stayers and that suggests that there’s still a shortage of labor for some companies,” said Dawn Fay, operational president at staffing firm Robert Half.

☆ Mortgage rates remain volatile, tick down after climbing for two weeks
▼ + stars: | 2023-05-04 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

Washington, DC CNN —The only thing consistent about mortgage rates right now is that they are volatile in the wake of mixed economic signals and recent bank failures. Mortgage rates ticked down this week, after climbing for two weeks in a row. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. Analysts have said that recent bank failures are doing some of the Fed’s work on reducing inflation for it. The move is unlikely to have a big impact on mortgage rates, as the move was already factored in for most investors said Xu.

☆ JPMorgan just got a lot bigger — and Elizabeth Warren is alarmed
▼ + stars: | 2023-05-02 | by ( Matt Egan | ) edition.cnn.com time to read: +4 min

Washington, DC CNN —JPMorgan Chase has once again come to the rescue of the banking system by acquiring a doomed bank. By blessing JPMorgan’s takeover of First Republic Bank, Warren fears federal regulators just made the” Too Big to Fail” problem even worse. My view on this is it’s important to look at the effect on competition and to try to keep a more diversified banking system,” Warren said. For his part, JPMorgan CEO Jamie Dimon is hopeful his bank’s takeover of First Republic eases the stress in the banking system. Clawing back banker payIn the wake of the bank failures, Warren is calling for accountability — both of bank executives and regulators.

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