Market Snapshot | Feb 26, 2018 | Darel Ansley | People's Bank
February 26, 2018 | Jeff Hallman
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Inside Lending
 
 
 
 
  Darel Ansley Darel Ansley
Senior Real Estate Loan Officer
NMLS# 500247
901 North Mission Street
Wenatchee, WA 98801Office: (509) 664-5324
Mobile: (509) 860-3301
Fax: (509) 664-5315
darel.ansley@peoplesbank-wa.com
www.peoplesbank-wa.com/darel
  Peoples Bank  
 
For the week of February 26, 2018 — Vol. 16, Issue 9
>> Market Update
QUOTATION OF THE WEEK... "Those are my principles, and if you don't like them... well, I have others." --Groucho Marx, American comedian, writer and stage, film, radio and television star
INFO THAT HITS US WHERE WE LIVE... Following their December decline, Existing Home Sales dipped again in January by 3.2%, to a 5.38 million annual rate. Though volatile month to month, home sales in 2017 racked up their best year since 2006 and are expected to maintain that upward trend.
An IRS bulletin explains interest on home equity loans may still be deductible . The loan must be used to "buy, build or substantially improve" a home. And to  deduct interest, all loans on the home cannot exceed a $750,000 limit ($350,000 if married filing separately).
As with all tax matters, always consult a tax professional before making any tax-related decision.
BUSINESS TIP OF THE WEEK...  Spend a half hour to an hour each day prospecting on the phone. Book the time on your schedule--and just do it. Why? People who consistently prospect earn more. Simple as that.
>> Review of Last Week

FED FOLLIES... A crazy week on Wall Street, thanks to the Fed. Stocks went south on Wednesday after the Fed's Minutes from its last meeting revealed most members see stronger growth in the economy and inflation. This could necessitate more rate hikes, which investors don't much like.
But Friday, the Fed's semi-annual monetary policy report also noted broad improvement in the economy and increasing inflation, but did not suggest that rising prices dictated more aggressive rate hikes.  Happy with that, the market rallied to another weekly gain.
GDP averaged 2.9% the last three quarters (after averaging 2.1% since 2010), unemployment is at a 17-year low, and wages, consumer confidence and business investment are rising. A few rate hikes (which, remember, are starting from a very low level) may be a small price to pay for this progress.
The week ended with the Dow UP 0.4%, to 25310; the S&P 500 UP 0.6%, to 2747; and the Nasdaq UP 1.4%, to 7337.

Bond prices suffered from the inflation worries, but recovered a bit on Friday. The 30YR FNMA 4.0% bond we watch ended unchanged, at $102.47. N ational average  30-year fixed mortgage rates in Freddie  Mac's latest Primary Mortgage Market Survey  edged up.  Remember, mortgage rates c an be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW?...Zillow reports the U.S. housing market has completely recovered its $9 trillion of value lost in the downturn. The average U.S. home is now worth $55,200 more than when prices hit bottom.  

>> This Week's Forecast
NEW AND PENDING HOME SALES, THE ECONOMY, INFLATION ALL  GROW ... Expect to see New Home Sales up in January, along with the Pending Home Sales index of contracts signed on existing homes. The Q4 GDP-2nd Estimate should show the economy growing at a 2.5% annual rate, enough to spur additional growth in Core PCE Prices, the Fed's favorite inflation read.
>> The Week's Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Economic Calendar for the Week of Feb 26 - Mar 2
M
Feb 26
08:30
New Home Sales Jan 645K 625K Moderate
Tu
Feb 27
08:30
Durable Goods Orders Jan
-2.0% 2.9% Moderate
Tu
Feb 27
10:00
Consumer Confidence Feb 126.5 125.4 Moderate
W
Feb 28
08:30
Q4 GDP - 2nd Estimate Q4 2.5% 2.6% HIGH
W
Feb 28
09:45 Chicago PMI Feb 64.5 65.7 HIGH
W
Feb 28
10:00
Pending Home Sales Jan
0.4% 0.5% Moderate
W
Feb 28
10:30
Crude Inventories 02/24 NA -1.6M Moderate
Th
Mar 1
08:30
Initial Unemployment Claims
02/24
227K 222K Moderate
Th
Mar 1
08:30
Continuing Unemployment Claims
02/17
NA 1.875M Moderate
Th
Mar 1
08:30
Personal Income Jan
0.3% 0.4% Moderate
Th
Mar 1
08:30
Personal Spending
Jan
0.2% 0.4% HIGH
Th
Mar 1
08:30
Core PCE Prices Jan
0.3% 0.2% HIGH
Th
Mar 1
10:00
ISM Index Feb 58.4 59.1 HIGH
F
Mar 2
10:00
U. of Michigan Consumer Sentiment - Final Feb 99.5 99.9 Moderate

>> Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months... In the Fed futures market, they still see a March rate hike as a near certainty. May gets a hold, then we go up another quarter percent in June. Note: In the lower chart, an 83% probability of change is an 83% certainty the rate  will move higher .
Current Fed Funds Rate: 1.25%-1.50%
After FOMC meeting on: Consensus
Mar 21
1.50%-1.75%
May 2
1.50%-1.75%
Jun 13 1.75%-2.00%
Probability of change from current policy:
After FOMC meeting on: Consensus
Mar 21
       83%
May 2
       22%
Jun 13
       69%

 
This e-mail is an advertisement for Darel Ansley. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Peoples Bank and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Peoples Bank.
 
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