The US central bank is desperately trying to signal things are under control, despite letting inflation slip. The Federal Open Market Committee (FOMC) voted to make the largest rate hike in over 20 years. They won’t stop there, though, they hinted at similar hikes for at least the next two meetings this year. Quantitative tightening […]
Soaring mortgage costs are rapidly cooling the frothy American real estate market. Mortgage applications and pending home sales cratered, show leading indicators released this week. Demand is being throttled by rising mortgage rates, which are now at the highest level since 2009. Home prices have yet to respond to the fall in demand, but experts […]
US real estate prices were still soaring ahead of the last interest rate hike. The CoreLogic Home Price Index (HPI) reported record annual price growth for February. Most of the performance is due to the South, which has seen a new wave of population growth. The firm doesn’t see this lasting much longer, though. Higher […]
US real estate is in the first bubble since the Great Recession, and they might actually address it in time. In December, we revealed a little-known model from the Dallas branch of the US Federal Reserve showing US housing in a bubble. Central bank researchers maintain the model as an early warning system, allowing policymakers […]
Central banks went from the transitory narrative to scrambling to prevent another Great Inflation era, faster than it takes to print $100 billion in Fed Treasuries. In a speech today, US Federal Reserve Chairman Jerome Powell pledged to take extreme measures to curb inflation if needed. The central banker warned this includes the possibility of […]
The US is raising interest rates for the first time in years, and they plan to make up for lost time. The Federal Open Market Committee (FOMC), which governs the US Federal Reserve, announced a quarter-point hike today. This increases the federal funds rate lower (0.25%) and upper (0.50%) bounds for the first time since […]
American real estate just spent another quarter in bubble territory, according to its central bank. The US Federal Reserve Exuberance Index shows US real estate was still exuberant in Q3 2021. A quarter before, the market fit the criteria set out by researchers to be considered a bubble. It also happened to be the quarter […]
Global markets are puking as the Ukraine-Russia conflict presents global uncertainty and risk. BMO chief economist Douglas Porter wrote a special brief to clients today, explaining this doesn’t change much at this point. BMO still expects the Bank of Canada (BoC) and the US Federal Reserve to hike interest rates in March. The influence on […]
US mortgage activity is suddenly slowing down as interest rates climb. The Mortgage Bankers Association (MBA) Mortgage Composite Index showed a sudden drop for the week of February 18, 2022. Seasonally adjusted mortgage application activity dropped 13.1% from the week before. On an unadjusted basis, activity dropped 11% compared to the same week a year […]
Canadian and American real estate prices are both at frothy valuations, but look nothing alike. US Federal Reserve (The Fed) data shows home prices grew faster than incomes in Q2 2021 for both countries. The difference is, this has been a long-term trend for Canada since 2005. Meanwhile in the US, home prices have only […]
