July 25, 2014
U.S. Treasury
24-Jul
17-Jul
1 Mo
Ago
YE
2013
12Mos
Ago
Eff Fed Funds
0.09%
0.09%
0.10%
0.09%
0.09%
3 Months
0.03%
0.01%
0.03%
0.07%
0.02%
6 Months
0.05%
0.05%
0.05%
0.09%
0.06%
1 Year
0.10%
0.08%
0.08%
0.11%
0.12%
2 Years
0.49%
0.45%
0.46%
0.38%
0.35%
3 Years
0.98%
0.92%
0.93%
0.77%
0.64%
5 Years
1.70%
1.62%
1.67%
1.74%
1.38%
10 Years
2.50%
2.45%
2.58%
3.03%
2.59%
30 Years
3.30%
3.27%
3.40%
3.97%
3.65%
3 mo to 2 year
0.46%
0.44%
0.43%
0.31%
0.33%
2 year to 10 year
2.01%
2.00%
2.12%
2.65%
2.24%
3 mo to 10 year
2.47%
2.44%
2.55%
2.96%
2.57%
Spreads:
Benchmark Changes:
3 Months
-
0.02%
0.00%
-0.04%
0.01%
2 Years
-
0.04%
0.03%
0.11%
0.14%
5 Years
-
0.08%
0.03%
-0.04%
0.32%
10 Years
-
0.05%
-0.08%
-0.53%
-0.09%
Key Indices
24-Jul
Dow Jones
17-Jul
1 Mo
Ago
YE
2013
12 Mos
Ago
17083.8
16976.8
16818.1
16576.7
15542.2
NASDAQ
4472.1
4363.4
4350.4
4176.6
3579.6
S&P
1987.9
1958.1
1949.9
1848.4
1685.9
Gold
1292.7
1309.7
1322.1
1202.3
1327.9
CRB Index
490.4
489.4
497.1
456.4
470.1
Crude Oil
102.7
102.9
105.3
98.4
93.1
Eff Fed Funds
0.09%
0.09%
0.10%
0.09%
0.09%
Prime Rate
3.25%
3.25%
3.25%
3.25%
3.25%
1 mo LIBOR
0.15%
0.15%
0.15%
0.17%
0.19%
6 mo LIBOR
0.33%
0.33%
0.33%
0.35%
0.40%
12 mo LIBOR
0.56%
0.55%
0.55%
0.58%
0.68%
CU Avg 48 mo Auto
2.63%
2.63%
2.64%
2.69%
2.77%
CU Avg 60 mo Auto
2.74%
2.74%
2.75%
2.79%
2.90%
FHLM 15Y FR Mtg
3.26%
3.23%
3.30%
3.52%
3.53%
FHLM 30Y FR Mtg
4.13%
4.13%
4.17%
4.48%
4.51%
Indicative
Investment Spreads
Retail
CDs*
Agency
Bullets
Agency
Calls
Agency
CMOs
Term
Index
6 Months
0.05%
0.19%
0.07%
-
1 Year
0.10%
0.30%
0.09%
-
-
2 Years
0.49%
0.26%
0.11%
0.11%
0.63%
3 Years
0.98%
0.22%
0.10%
0.12%
0.70%
4 Years
1.34%
0.26%
0.08%
0.19%
0.85%
-
HOME SALES REPORTS
RESULTS IN JUNE
SHOW
MIXED
Industry reports on June home sales show the
housing sector remains very unsteady. While
sales of existing homes increased +2.6 percent
to an annual rate 5.04 million units, new home
sales fell -19.0 percent to a paltry 406,000
annual pace.
For the existing home market, single-family
sales increased +2.5 percent to 4.43 million
units. All four regions of the country reported
gains, led by a +6.2 percent increase in the
Midwest. Sales are approximately -2.3 percent
lower than a year ago.
Each region reported a drop in new home sales
in June, with the South being the most
important region due to its overwhelming size,
posting a -9.5 percent drop. Price data show a
+3.2 percent decline in the median price to
$273,500, approximately +5.3 percent higher
than one year ago.
Mixed signals within the new home sector also
show that while the index from the nation’s
home builders show strength in sales (and
expectation of sales), the number of housing
starts and building permits have been
plummeting.
Other Key Indicators this Week:
Consumer Inflation – Increased +0.3 percent
in June and is running at a +2.1 percent annual
rate.
Durable Goods – Orders rose +0.7 percent in
June, following a -1.0 percent decline in May.
Orders have increased in four of the last five
months.
Continued…
Strategically for Credit Unions:
The continued volatility in the housing sector is representative of the prevailing fragile economic environment.
Total home sales have retracted recently to an annualized pace of 5.45 million units but remain close to the
pace of sales in 2013. Current sales are also approximately 500,000 units above 2012 sales.
The current environment appears to have drawn sellers into the market as the supply of existing homes on the
market is about 6.5 percent higher than a year ago. Strength in sales does not appear to have come at the
expense of prices as the median rose +5.3 percent to $223,300.
But as existing home sales have bounced back strongly from a very weak, weather-worn first quarter, the
weakness in housing starts and permits has a direct correlation to poor construction activity, tepid hiring and
volatile spending behavior.
Although the housing sector, and the accompanying mortgage market, was expected to be only a marginal
contributor to economic growth in 2014, there was a concern that a simultaneous downward shift in consumer
sentiment would have a greater impact on the demand for consumer financing.
Through the first half of 2014, industry figures appear to dispel that notion as annualized real estate loan
growth has slowed from +5.8 percent to +4.2 percent in 2014 while vehicle loan growth is expanding at a +10.0
percent annual pace, compared with +11.3 percent last year.
Brian Turner – Director, Chief Strategist
Total Home Sales vs Avg Mortgage Rate
6,000
7.00%
6.50%
6.00%
5.50%
5.00%
4.50%
4.00%
3.50%
3.00%
5,500
5,000
4,500
4,000
3,500
3,000
'07
'08
'09
'10
'11
New Home Sales (000s)
500
'12
4,500
300
3,500
200
'14
Existing Home Sales (000s)
5,500
400
'13
2,500
'10
'11
'12
'13
'14
'10
'11
'12
'13
'14
Although this information has been obtained from sources we believe to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is
for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. All herein listed securities are subject
to availability and change in price. Past performance is not indicative of future results. Changes in any assumption may have a material effect on projected results.
©Catalyst Strategic Solutions 2014 | 800.301.6196 | catalyststrategic.org | catalystcorp.org | [email protected]