The economy and the market: weekly previews, recaps, monthly summaries, and major macro events as they land.
The MBA 30-year mortgage rate climbed to 6.81%, its highest level in a year, while total mortgage applications fell 2.9%. The move underscores how even a small rate increase can further strain affordability and cool housing demand as bond yields stay elevated.
U.S. services activity stayed in expansion territory in July, with new orders and business activity strengthening. But hiring slipped back into contraction and prices paid jumped sharply, underscoring a resilient economy that still faces stubborn inflation pressure and a cautious Fed outlook.
Private payroll growth cooled sharply in July, with ADP reporting just 44,000 jobs versus 70,000 expected. The weaker reading points to fading hiring momentum, easing pressure on the Federal Reserve, even as inflation remains above comfort levels and the labor market still shows expansion.
June housing data show a split market: construction jumped and new-home sales improved, but existing-home sales, mortgage applications and contracts weakened. Prices stayed firm and mortgage rates climbed, underscoring an affordability squeeze that is keeping the U.S. housing market stable but stuck without momentum.
U.S. factory orders slipped in June, missing forecasts and signaling softer manufacturing momentum beyond transportation. Still, strong core capital-goods demand tied to AI investment helped offset the weakness, while the ISM index stayed in expansion territory and kept recession fears in check.
June JOLTS showed U.S. job openings slipping to 7.359 million and hires easing, signaling a slower labor market without recession-level stress. Layoffs stayed steady, giving the Fed a softer labor read but not a clear reason to cut rates immediately.
US factory activity rebounded sharply in July, with the ISM Manufacturing PMI rising to 55.6, its strongest reading since May 2022. New orders and employment improved, but prices stayed elevated above 70, keeping inflation pressure and Fed hawkishness in focus.
July’s ISM Manufacturing PMI surged to 55.6, signaling a clear re-acceleration in factory activity. New orders and employment both moved back into expansion, but elevated input prices and only modest industrial production gains keep the outlook constructive yet inflation-sensitive.
This week’s U.S. data will test whether the economy is cooling in an orderly way or slipping faster than expected. JOLTS, ADP, ISM Services, jobless claims, mortgage rates, productivity, and Fed speeches all build toward Friday’s jobs report, with rates and markets watching inflation signals closely.
US data painted a split picture: GDP slowed to 1.5% while PCE inflation stayed stubbornly high. The Fed kept rates at 3.75% in a hawkish hold, and long-term yields surged, pushing mortgage rates higher and pressuring growth stocks, housing, and other rate-sensitive assets.
University of Michigan one-year inflation expectations fell to 4.2% in July from 4.6% in June, matching forecasts and signaling some relief for the Fed. But long-run expectations held at 3.3%, keeping policymakers cautious as consumers still see inflation as their top concern.
The Fed’s assets slipped $9 billion in the latest weekly reading, but the bigger picture is a balance sheet that has grown since runoff ended. Treasury bill purchases and reserve management have kept total assets near $6.7 trillion, while inflation and labor data remain the key rate drivers.
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