Consumer confidence and mortgage applications are making news today. Here's how the headlines could affect your money:
Typically, August is a slow month for the market, with average monthly gains of 0.6%, according to Yardeni Research. But this year, the market has deviated from historical patterns. Tuesday's close put the S&P up 5.3% for the month, while the Nasdaq is up 6.7%, and the Dow is up 6.9%.
Consumer confidence fell in August amid worries about the job market and other economic concerns. The consumer confidence index dropped to 84.8 from 91.7 in July, the Conference Board said Tuesday. That's a more than six-year low, and its lowest level since the pandemic began.
Economists pay attention to these monthly updates because consumer spending accounts for more than two-thirds of gross domestic product (GDP). How confident consumers feel affects their purchases — which sets the pace of economic recovery.
Video by David Fang
Mortgage applications rose 0.4% last week and are up 33% from a year ago, the Mortgage Bankers Association reported Wednesday. Rates are still near record lows, at an average 3.11% for 30-year fixed-rate mortgages.
To capitalize on that, get quotes from several lenders. A 2019 Zillow analysis found a median 97-basis-point difference between the worst and best quote on a typical loan. Hunting for a better deal could shave hundreds of dollars off your monthly payment and save you tens of thousands of dollars in interest over the life of your loan.
Video by Jason Armesto
How are you feeling about your personal financial situation and what's going on in the broader economy? Consumer confidence is an economic indicator that measures those sentiments, based on household spending and savings habits. It factors in opinions on current conditions, as well as what people expect to happen in the future.
Although the daily news can have an impact on your wallet, remember to take a long-term outlook when it comes to decisions on spending, saving, and investing.
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