Economic News this Week: It was a week of tight changes in the price of our bonds and therefore rates.

It was a week of tight changes in the price of our bonds and therefore rates. We went from a little good to a little bad news and back again.

On Tuesday the Personal Income numbers for June were released, and they were unchanged from last month. Personal spending was up 0.1%.

The ISM* released their Manufacturing Capacity number, which dropped from 57.8% to 56.3% – which is all mortgage interest rate neutral.

On Thursday the ISM released its Service Sector number, which was also down to 53.9%

*Institute of Supply Management for those of you who love definitions and wonder. Who cares about ISM?

• ISM Report On Business®
• The ISM Manufacturing and Non-Manufacturing Report On Business® are two of the most reliable economic indicators available, providing guidance to supply management professionals, economists, analysts, and government and business leaders. These are the first reports available on the first and third business day of each month and have been consistently accurate in indicating the direction of the overall economy in addition to the manufacturing and non-manufacturing sectors. However, the reports are not meant to be the only barometers consulted by those interested in tracking the economy – they should be used in conjunction with other measurements.

Friday the big number was out: Nonfarm payroll was up 209,000 mostly coming in the area of bar and restaurant jobs.

Unemployment dropped to 4.3% which leaves many to believe that this number will give the FOMC a reason to raise the federal funds rate in September (which dictates what we pay as the Prime rate on credit cards, home equity lines of credit, etc.)

Next week, potential market movers are the Thursday PPI and Friday CPI. If the cost of goods or the cost of finished products goes up then this could mean a sign of inflation and rates increasing but also would be more fuel for the fire for FOMC to raise the fed funds rate in September.

Also this week the Government will be selling (i.e., borrowing from us and other foreign countries) $62 Billion in 3, 10 and 30 year bonds. Depending on investor appetite, this could move rates up or down as well. This could be a rocky week.

So after all that, interest rates went up a little, down a little and remain the same as last Friday.

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