Inflation Up 9.1% YOY, Largest Gain Since 1981

Inflation jumped by 9.1% YOY in June, more than analysts predicted and the largest gain since 1981, according to data released by the Labor Department today. The Consumer Price Index showed inflation rising 1.3% month-over-month, its largest jump since 2005. Predictions ahead of the data’s release forecast a 1.1% rise from May and an 8.8% increase YOY. This is the fourth consecutive month that analyst predictions fell short. Another month of skyrocketing inflation suggests that officials will be forced to continue aggressively raising interest rates.  But rate hikes have stoked fears of a recession. Strategists at Goldman Sachs recently upgraded their recession probability to 30% from 15%. “We now see recession risk as higher and more front-loaded,” Goldman Sachs Chief…

Rate Cuts Could Come This Year If Fed Can’t Get Inflation Under Control, Analysts Suggest

With the July Federal Open Markets Committee meeting fast approaching, speculation about another substantial rate hike is running rampant. After June’s historic 0.75 percentage point interest rate hike, the third hike this year and the largest since 1994, analysts are watching the Fed closely. Recession fears are rapidly growing, with 70% of economists expecting it by 2023. But Federal Reserve Chairman Jerome Powell said he was more concerned about high inflation continuing than about the possibility of rising interest rates causing a recession. “Is there a risk we would go too far? Certainly there’s a risk,” Powell said this week. “The bigger mistake to make, let’s put it that way, would be to fail to restore price stability.” Some experts…

Morning Roundup (2/22/2022)– Rental rates, NJ Foreclosure Funding

Good Morning! Today is Tuesday, February 22. In a speech, Putin laid claim to Ukraine as a country “created by Russia.” Prime Minister Boris Johnson lifted all restrictions in England and announced an end to most free testing. A Biden administration plan to reduce drug deaths will include clean-needle exchanges. The Mortgage Note Reports Rental Rates Up By More Than 15%, Adding To Inflation: Monthly asking rates for rentals increased 15.2% year-over-year in January, and some economists say this is accounting for a significant portion of recent inflation. Foreclosures In New Jersey: $10 Million Set Aside To Help: State officials in New Jersey will use $10 million in federal funding to purchase mortgage notes of homes on the verge of…

Fed’s Bowman Suggests Half-Point Rate Hike In March

Federal Reserve Governor Michelle Bowman said the Fed could hike rates by half a percentage point in March, suggesting the move is necessary to fight inflation. Inflation is currently at a four-decade high, with the Consumer Price Index up 7.5% year-over-year in January 2022. “The nation is dealing with inflation at its highest level in decades, much of it driven by corporate greed and anticompetitive behavior, and the federal government must use every tool available to prevent price gouging and reduce prices for Americans,” Massachusetts Senator Elizabeth Warren wrote in a letter to the Department of Justice, asking it to take action against companies violating antitrust laws to hike prices for consumers.  Bowman said Monday that inflation is “much too high” and suggested…

Morning Roundup (1/27/2022)– Behind The Inflation Curve, Loan Apps Down

Good Morning! Today is Thursday, January 27. Supreme Court Justice Stephen Breyer is retiring. Neil Young is removing his music from Spotify, saying it has become “the home of life-threatening Covid misinformation.” The U.S. rejected Russia’s demands that NATO retreat from Eastern Europe and bar Ukraine from ever joining, but offered other areas of negotiation. The Mortgage Note Reports Rate Increases Into 2023: At least one economist says the Federal Reserve is already behind the inflation curve, and the mortgage industry should expect interest rate increases into 2023. Down, Up, Then Back Down: Mortgage loan application volume fell 7.1% from last week, with refis tumbling 13%, MBA reported. “Appropriate Pricing Policies”: CHLA sent a letter to FHFA Acting Director Sandra…