This article is about the producer price index drop signals lower mortgage rates. BREAKING NEWS on the producer price index drop signals lower mortgage rates in the coming months: After news that producer price index unexpectedly rose in August 2019, breaking news hit the wire in September 2019 that the producer price index (PPI) dropped 0.3% in September. The U.S. Producer Prices rise in August surprised the market.
Producer Prices rebounded in August. However, September numbers came up and the Producer Price Index dropped 0.30%. This means that the costs of production are lower for producers and signals low inflation.
August’s data of the PPI rebounding signaled the Feds would not cut rates. However, with the lower September numbers, experts predict future interest rate cuts which mean lower mortgage rates for homeowners and homebuyers seeking a mortgage. In this article, we will cover and discuss the pfoducer price index drop signals lower mortgage rates.
What Is The Producer Price Index (PPI)
The Producer Price Index is a measure economists use to gauge the level of inflation. A low PPI number means the cost of producing goods is low which means that the inflation levels and chances of inflation are low. If the PPI remains high, it means that the risk of inflation is high. Low PPI numbers is great that mortgage rates will remain the same or lower. A higher PPI number means that mortgage rates may be on the rise due to fears of inflation. Speak With Our Loan Officer for Get Mortgage Loans
U.S Tariffs
The Trump administration seems to have worked out imposing the next round of tariffs in the next period. This sent stocks soaring on Friday, October 12th, 2019. Many fear the economy will tank if President Trump imposes tariffs on various consumer goods. Others have fears that the downturn in manufacturing will have a negative impact on the broader economy and slow the longest-lasting economic rally which has lasted over 11 years. The economy remains strong with the highest consumer spending in many years and a strong growing labor force. Due to fears of inflation and another recession, the Federal Reserve Board cut rates for the first time since the 2008 Great Recession.
What Experts Say
Both the PPI and CPI are gauges to predict the economy, inflation, and a potential recession. With mortgage rates, bad economic news means lower mortgage rates. In general, when the Feds cut rates mean lower mortgage rates. If the stock market plunges, it normally means lower mortgage rates. This is a developing story on Gustan Cho Associates Mortgage News. We will keep our viewers updated as more develops.
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This headline news was updated on January 17th, 2024.
