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Mark Hemingway

Mortgage Market Update for June 11th

Tuesday, June 11, 2019 - Article by: Mark Hemingway - Security Financial Services, LLC - Message

Mortgage credit availability increased in May due in part to a fifth straight gain in the jumbo index. The Mortgage Bankers Association reports that its Mortgage Credit Availability Index (MCAI) rose 1.9% in May to 189.5. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. "Credit supply increased 2% in May, driven by the fifth straight gain in the jumbo index, which was up 7% and surpassed last month as the new all-time survey high," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting.

Small business optimism roared back in May to near historic highs due in part to strong hiring, investment and sales. The NFIB Small Business Optimism Index rose 1.5 points in May to 105.0. The report went on to reveal that earnings, job creation and compensation remained strong in May. NFIB President and CEO Juanita D. Duggan said, "The small business half of the economy is leading the way, taking advantage of lower taxes and fewer regulations, and reinvesting in their businesses, their employees, and the economy as a whole."

Wholesale inflation remained tame in May as the Producer Price Index (PPI) rose 0.1%, in line with estimates while the Core PPI rate also met expectations. With trade headlines dominating the headlines, these minor economic reports, which are reported close to expectations, are not influencing the market. The more closely watched Consumer Price Index will be released tomorrow but again, in absence of a wild surprise, there should not expect much of a market reaction.

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