Financial Calendar for the week of 7/10 to 7/14
The following events, reports, and announcements may have the potential to influence the market in the second week of July 2023.
Monday, July 10th
Wholesale inventories – May 2023
Fed Vice Chair Barr speaks
San Francisco Fed President Daly speaks
Cleveland Fed President Mester speaks
Consumer Credit – May 2023
Tuesday, July 11th
NFIB Optimism Index – June 2023
Wednesday, July 12th
Consumer price index – June 2023
Core CPI – June 2023
CPI – year over year
Core CPI – year over year
Richmond Fed President Barkin speaks
Atlanta Fed President Bostic speaks
Fed Beige Book
Thursday, July 13th
Initial jobless claims – Week of July 8th
Producer price index – June 2023
Core PPI – June 2023
PPI – year over year
Core PPI – year over year
Federal budget – June 2023
Fed Governor Waller speaks
Friday, July 14th
Import price index – June 2023
Import price index minus fuel – June 2023
Consumer sentiment – July 2023 (preliminary)
Will home affordability be restored before 2025?
A recent housing report put out by Morningstar, Inc., a financial services firm based in Chicago, states that affordability will slowly start to return to the housing market with substantial cooling by 2025.
The report from Morningstar predicts that mortgage rates will start to cool off in the second of 2023 with further cooling throughout 2024. The report stated, “Regardless of what happens in the next few years, we expect interest rates to ultimately settle back down at the low levels that prevailed before the pandemic. The low-interest-rate regime will resume once the dust settles from the pandemic economic volatility.”
The report went on to say, “Our long-term interest-rate projections are driven by secular trends. Factors such as aging demographics, slowing productivity growth, and increasing inequality have acted to push down real interest rates for decades, and these forces haven’t gone away.”
Key factors in the future economic outlook that played a large role in the prediction were rising income levels and falling home prices.
Which housing markets are seen as currently undervalued?
According to the U.S. Department of Housing and Urban Development, households should spend less than 30% of income on housing costs.
Recent data from U.S. News & World Report indicated that there are 14 metro areas in the U.S. that are affordable enough to allow homeowners to pay less than 30% of their income.
The most undervalued area in the country right now? It’s the Detroit-Warren-Dearborn metro area. The Detroit area currently has a payment-to-income ratio of 17.4%, meaning that only 17.4% of income is used on housing. Cleveland was in second place with 18.9%, and St. Louis came in third place with 21.7%.
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