Rising Inflation
Headlines about the conflict in Ukraine continued to cause volatility in mortgage markets this week, but their net impact was roughly neutral. Instead, the primary influence was growing concern about rising inflation, and mortgage rates ended the week higher.
The Consumer Price Index (CPI) is a closely watched inflation indicator that looks at price changes for a broad range of goods and services. Core CPI excludes the volatile food and energy components and provides a clearer picture of the longer-term trend. In February, Core CPI was 6.4% higher than a year ago, up from an annual rate of increase of 6.0% last month, and the highest level since 1982.
There are many reasons why the annual core inflation rate has jumped from the readings below 2.0% seen early in 2021, including a tight labor market, strong consumer demand for goods, and supply chain disruptions. Shortages for many items have caused enormous cost increases, such as used car prices which are 41% higher than a year ago. Fed officials and economists are divided about how much the recent spike in inflation will subside as temporary factors caused by the pandemic are resolved.
Faced with skyrocketing prices and the conflict in Ukraine, the European Central Bank (ECB) had to make a very difficult decision at its meeting on Thursday. It chose to prioritize lower inflation over economic growth by announcing that it plans to end its bond purchase program in the third quarter, which was earlier than expected. ECB President Lagarde acknowledged that the conflict in Ukraine will have "a material impact on economic activity," but had little choice in tightening monetary policy to help bring down inflation.
Looking ahead, investors will continue to closely follow news on Ukraine.
You can get a rate quote within minutes with just a few simple steps to start.
Apply online:http://visionquestlending.com/free_quote/
BBB A+
Tony Nguyen | NMLS#93776
Vision Quest Lending | 2860 Michelle Drive, Suite 140, Irvine, CA 92606
Direct 714-464-8042 | 877-318-0992 x6502 | Fax 866-394-9352
Email | tony@vqlending.com
Website | www.visionquestlending.com
Headlines about the conflict in Ukraine continued to cause volatility in mortgage markets this week, but their net impact was roughly neutral. Instead, the primary influence was growing concern about rising inflation, and mortgage rates ended the week higher.
The Consumer Price Index (CPI) is a closely watched inflation indicator that looks at price changes for a broad range of goods and services. Core CPI excludes the volatile food and energy components and provides a clearer picture of the longer-term trend. In February, Core CPI was 6.4% higher than a year ago, up from an annual rate of increase of 6.0% last month, and the highest level since 1982.
There are many reasons why the annual core inflation rate has jumped from the readings below 2.0% seen early in 2021, including a tight labor market, strong consumer demand for goods, and supply chain disruptions. Shortages for many items have caused enormous cost increases, such as used car prices which are 41% higher than a year ago. Fed officials and economists are divided about how much the recent spike in inflation will subside as temporary factors caused by the pandemic are resolved.
Faced with skyrocketing prices and the conflict in Ukraine, the European Central Bank (ECB) had to make a very difficult decision at its meeting on Thursday. It chose to prioritize lower inflation over economic growth by announcing that it plans to end its bond purchase program in the third quarter, which was earlier than expected. ECB President Lagarde acknowledged that the conflict in Ukraine will have "a material impact on economic activity," but had little choice in tightening monetary policy to help bring down inflation.
Looking ahead, investors will continue to closely follow news on Ukraine.
You can get a rate quote within minutes with just a few simple steps to start.
Apply online:http://visionquestlending.com/free_quote/
BBB A+
Tony Nguyen | NMLS#93776
Vision Quest Lending | 2860 Michelle Drive, Suite 140, Irvine, CA 92606
Direct 714-464-8042 | 877-318-0992 x6502 | Fax 866-394-9352
Email | tony@vqlending.com
Website | www.visionquestlending.com