Benjamin Mathews

”Pending home sales in March increased by 1.5% from the prior month and declined 1.1% year over year, according to the National Association of REALTORS® Pending Home Sales report.”

Source: https://www.nar.realtor/newsroom/nar-pending-home-sales-report-shows-1-5-increase-in-march

”1.4% increase in median existing-home sales price to $408,800.”

Source: https://www.nar.realtor/newsroom/nar-existing-home-sales-report-shows-3-6-decrease-in-march

”Existing-home sales decreased by 3.6% month-over-month in March, according to the National Association of REALTORS® Existing-Home Sales Report.”

Source: https://www.nar.realtor/newsroom/nar-existing-home-sales-report-shows-3-6-decrease-in-march

Interest rates closed higher this week. The 10-Year Treasury currently sits at 4.30% which is the midpoint between the high yield and low yield so far this month. The 10-Year is also sitting at the midpoint of the wedge pattern that has been forming since March 2023. The 10-Year Breakeven rate is at 2.433%, showing no signs of stress. Bond Volatility has been crushed after spiking in March. Interest rates are right where they should be. Elevated energy prices continue to push near to inflation expectations higher, but longer-term inflation expectations remain stable.

Retail Sales, the only major economic indicator released this week, beat expectations, rising +1.7% MoM vs expectations of +1.4%.

The Federal Reserve will meet on Wednesday next week. Interest rates are expected to remain unchanged. On Thursday we will get the March PCE report. Headline inflation is expected to come in at +0.6% MoM. Core inflation is expected at +0.3% MoM.

”Pending home sales in February increased by 1.8% from the prior month and declined 0.8% year over year, according to the National Association of REALTORS® Pending Home Sales report.”

Source: https://www.nar.realtor/newsroom/nar-pending-home-sales-report-shows-1-8-increase-in-february

Interest rates closed lower this week for the third consecutive week.

Headline whiplash dropped WTI to $86/bbl. For now, it appears the Straight of Hormuz is open for business. Peace talks will continue over the weekend. There is 29% chance of a peace deal within the next week according to Polymarket.

Existing Home Sales slumped -3.6% in March at an annualized pace of 3.98MM.

PPI confirmed the same story as CPI last week. Headline inflation is up due to increasing energy costs (+0.5% MoM) while core inflation continues to come in below expectations (+0.1% MoM). Final Demand Services was 0.0% in March. If the Straight of Hormuz truly is open, one might expect the core inflation figures to remain low enough for the Fed to resume rate cuts. Powell’s term will be up in 28 days and a new Fed Chair would likely be eager to deliver rate cuts. Fed Funds Futures have improved steadily. December 2026 currently has a 65% chance of a 25 bps rate cut.