The Consumer Price Index increased .30% in June over the prior month. Year over year the inflation rate remained steady at 2.10%. Two-thirds of the increase was primarily driven by the gasoline index. Since June oil and gas prices have decreased which should lower inflation expectations and keep the Federal Reserve on the same monetary policy path.
Existing Homes Sales rose 2.60% in June from May, house prices increased 0.40%, and MBA Mortgage Applications increased 2.40% in the week ended July 19th. New Home Sales did not fare as well in June, dropping 8.10% from May. Real estate has been providing mixed results and has not been the driver to growth many economists expected at this point of the economic cycle.
The job market has been producing continued strength as Initial Jobless Claims for state unemployment benefits decreased to 284,000 for the week ending July 19th from a revised 303,000 during the previous week. The Fed will hope this trend continues to reduce the slack in the labor market prior to hiking interest rates.