Below is a chart and excerpt from today's Early Look written by Director of Research Daryl Jones.
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As we’ve discussed fairly frequently, the immediate term transmission mechanism for rate hikes is the U.S. housing market. We’ve seen this in spades over the last couple of months with 30-year mortgage rates now sniffing at 6.0% and near the highest levels since 2008. As a result, since the start of the year demand for houses has shriveled. This week’s mortgage purchase applications declined sequentially for the 5th week in a row and on a monthly basis the index hit 198. To put in context, and shown in the Chart of the Day, this is a level that is just above the depths of the pandemic and down ~-36% since the start of the year. As far as Fed Operation Break Sh*t goes, that mission is being accomplished in the housing market. |
