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Richard Airey

Daily Mortgage Market Update

Wednesday, November 20, 2013 - Article by: Richard Airey - First Financial Mortgage - Message

Economic news was abundant today with readings on inflation, consumer spending, and housing.The Bureau of Labor Statistics reported today that its Consumer Price Index (CPI) declined by 0.1% in October mainly due to a drop in energy prices. Estimates were calling for 0.0% in October as inflation continues to remain tame. On a year-over year basis, CPI was 1%, the smallest increase since the fall of 2009. CPI measures the changes in the prices paid by urban consumers for goods and services.Due to the drop in energy and subsequent decline in prices at the pump, U.S. consumers were able to spend more on clothing, electronics, and autos in October. Retail Sales rose by an unexpected 0.4% when estimates were calling for an increase of just 0.1%. Retail Sales account for about 1/3 of consumer spending, one of the main drivers of the U.S. economy. Over in housing news, the numbers weren't as good in October.The National Association of Realtors reported today that Existing Home Sales fell by 3.2% due to a rise in home loan rates and housing prices. There were 5.12 million units sold annualized, below the 5.20 million expected and was the second month of declines. The median sales price was $199,500, up nearly 13% since the year-earlier period. Inventories were at a 5-month supply.

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