Scott Bessent is Trump’s nominee for treasury secretary. A longtime investor and hedge fund manager confirmed during his hearing he plans to extend the tax code overhaul from 2017. According to the nonpartisan Committee for a Responsible Federal Budget this will increase the national debt by $4T over 10 years. With at least $500 Million in assets, he could become a member of the wealthiest White House ever.
Mortgage Rates – improved nicely this week as the Price of Mortgaged Backed Securities bounced back from last weeks’ decline. Mortgage rates are up roughly 0.5% from this time last year.
Manufacturing – the Philadelphia Fed Manufacturing Index improved sharply this month. It rose from -11 to 44.3 – the highest reading since April 2021. It could be that manufactures are pulling orders forward and stockpiling inventory early to hedge against potential tariffs.
Inflation – the Consumer Price Index rose 0.4% in December and year over year inflation increased from 2.7%-2.9%. The biggest contributor was energy which rose 2.6% month over month accounting for 40% of the increase. The Core Rate, which strips out food and energy declined from 3.3% to 3.2% year over year.
Mortgage Applications to purchase homes rose 27% last week and are down 2% year over year. Refinances increased 44% and are up 22% year over year. These numbers are slightly skewed because they are being compared to a holiday week last year.