High points for US economic data scheduled for August 19 week

Economic data in the August 19 week will take a backseat to the Kansas City Fed’s annual Jackson Hole (August 22-24) which will be brimming with central bankers and offering an opportunity to gauge the outlook for less restrictive monetary policy. In particular, Fed Chair Jerome Powell is likely to send a message to markets that anticipation of a rate cut in September is justified, absent unexpected developments. His speech is scheduled for 10:00 ET on Friday. There is also the Democratic National Convention in Chicago which will run August 19-22.

The presence of Powell and other Fed policymakers at the Jackson Hole conference means that the release of the minutes of the July 30-31 FOMC meeting at 14:00 ET on Wednesday will get only cursory attention with more relevant commentary soon to be had. July’s meeting was held before the August 2 release of the July employment report which briefly spooked markets with its below-expectations gain in payrolls and above-expectations increase in the unemployment rate. Subsequent numbers calmed jitters that the labor market was weakening too much, too quickly. In any case, recent data on inflation and inflation expectations point to ongoing disinflation that, however, still shows no better than slow deceleration in the service sector.

NAR data on sales of existing homes in July at 10:00 ET on Thursday will reflect contracts closed mostly with mortgages secured in June when rates were just beginning to decline below 7.0 percent as seen in the weekly Freddie Mac reports for 30-year fixed rate mortgages. Even though supplies of existing homes for sale have improved, some potential homebuyers appeared to be waiting in July for rates to move yet lower. Census Bureau data on sales of single-family homes in July at 10:00 ET on Friday are for contracts taken out on new construction at a time when the 30-year fixed rate was averaging around 6.8 percent and on the way down. The weekly indexes of mortgage applications from the MBA have not shown a significant upswing for new mortgages, although there is a miniboom occurring for refinancing of higher rate mortgages and likely also for converting adjustable-rate mortgages to fixed rates, or perhaps even refinancing higher rate ARMs to lower rate ones.

In any case, the Freddie Mac weekly numbers for mortgages put the rate for a 30-year fixed rate mortgage at 6.49 percent in the week ended August 15. It was slightly lower at 6.47 percent in the prior week, but these are the lowest rates seen since May 2023.