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Inflation continued to rise in December – The Consumer Price Index (CPI) showed that consumer prices increased 2.9% year-over-year December, its third straight month of year-over-year increases, and its highest level in five months. The CPI peaked at 9.1% in June 2022 and worked its way down to a 2.4% year-over-year increase in September but has increased every month since its September low. Core CPI, which excludes volatile food and energy costs, rose 3.2% year-over-year in December, down from 3.3% in November. The Produce Price Index (PPI) showed that wholesale prices increased 3.3% year-over-year in December, up from a 3% year-over-year increase in November. Core PPI increased 3.5% year-over-year in December, up from 3.3% in November. Mortgage rates and bond yields increased early in the week but ended the week lower than they were on Wednesday as experts had forecasted inflation to rise even more than it did.
Below is a chart of the CPI rate from 2021
Stock markets – The Dow Jones Industrial Average closed the week at 43,478.83, up 3.7% from 41,938.45 last week. It is up 2.2% year-to-date. The S&P 500 closed the week at 5,996.96, up 2.9% from 5,827.04 last week. The S&P is up 2% year-to-date. The Nasdaq closed the week at 19,630.20, up 2.4% from19,161.63 last week. It is up 1.7% year-to-date. U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 4.61%, down from 4.77% last week. The 30-year treasury bond yield ended the week at 4.84%, down 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 January 16, 2025, were as follows: The 30-year fixed mortgage rate was 7.04%, up from 6.93% last week. The 15-year fixed was 6.27%, up from 6.14% last week. The graph below shows the trajectory of mortgage rates over the past year.
For those of you that are displaced by the recent fires, we are so sorry to see you going through this situation. We had the opportunity to tour the devastation. It is beyond belief. As we wait to re-enter our properties and learn to live in our communities devastated by fire, we are all bracing ourselves for the uncertainty ahead. The rebuilding process will be complicated and painful, but someday down the line, our area will be new and pristine. While our hearts are broken by what we have experienced we are here for those in need. Our Realtors have and will continue to work 24/7 to help people find shelter. Even our Realtors who have lost their homes, our Palisades office, all their belongings, etc. are working tirelessly to find housing for their friends and neighbors. We commit to being around for anything that you need. If you need help with finding resources, FEMA, SBA, understanding your insurance coverage, housing, food clothing, etc. reach out to me. We have resources at Rodeo Realty to help you. You do not have to be a client. We are here to help anybody in need. Please stay safe!
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