Fed Is Staying the Course on Interest Rates, Housing Is Feeling the Impact

 The overheated employment market appears to be cooling off, but probably not fast enough to demonstrate the progress the Federal Reserve wants to see in its efforts to combat inflation, still growing at an uncomfortable 8 percent annual rate.

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If home sales alone were an indicator of economic health, you might conclude that the economy has rebounded smartly from the pandemic-induced recession and is on a path for steady growth. 

If timing is everything, the June employment report is a lot less encouraging than it appeared to be. 

The COVID pandemic has created a cluttered and confusing financial landscape.  It’s hard to know where to look or how to interpret what you see.  Consider the housing market.

 Economists often miss the mark, but they rarely miss it by as much as they did with their employment forecasts for June.

The consensus forecast anticipated a loss of more than 7 million jobs on top of the stomach-churning 20.5 million positions shed in April.  Instead, employers added more than 2.5 million jobs, reducing the unemployment rate to 13.3 percent, down from April’s 14.7 percent and well below the 19 percent rate analysts had feared.