Inflation increased in June – The Consumer Price Index (CPI) jumped to an annual increase of 2.7% in June. That is up from 2.3% in April, its lowest reading since early 2021, and 2.4% in May. Core CPI, which excludes volatile costs like food and energy, was up 2.9% year-over-year, up from 2.8% in May. We have been closely following the inflation data because it has a direct correlation to interest rates. The Fed has put off interest rate reductions in fear that tariffs will lead to higher prices for consumers. As the Fed expected, after dropping steadily since peaking in 2022, inflation is now showing signs of heating up again.
Stock Markets – The Dow Jones Industrial Average closed the week at 44,342.19, down 0.1% from 44,371.51 last week. Year-to-date, it is down 0.4% from 44,544.66 on December 31, 2024. The S&P 500 closed the week at 6,296.79, up 0.2% from 6,259.75 last week. Year-to-date the S&P is up 3.8% from 6,040.53 on December 31, 2024. The Nasdaq closed the week at 20,895.66, up 1.5% from 20,585.53 last week. Year-to-date it is up 6.5% from 19,627.44 on December 31, 2024.
U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 4.44%, almost unchanged from 4.43% last week. The 30-year treasury bond yield ended the week at 5.0%, up slightly from 4.96% last week. We watch bond yields because mortgage rates follow bond yields
Mortgage rates – Every Thursday Freddie Mac publishes interest rates based on a survey of mortgage lenders throughout the week. The Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products as of July 17, 2025, were as follows: The 30-year fixed mortgage rate was 6.75%, up slightly from 6.72% last week. The 15-year fixed was 5.92%, up from 5.86% last week.
The graph below shows the trajectory of mortgage rates over the past year.
California existing-home sales – The California Association of Realtors reported that existing-home sales totaled 264,260 on an annualized basis in June, up 4% from 254,190 in May. Year-over-year sales were down 0.3% from a revised 264,960 annualized home sales last June. The statewide median price paid for a home in was $899,720 in June, down 0.1% from $900,720 in June 2024. There was a 3.8-month supply of homes for sale in June, up from a 3-month supply of homes for sale one year ago.
The graph below lists home sales data by county in Southern California.
Have a Great Weekend!