Spotlight: What Can Move the Fed Ahead of Sept 17? 🔦
A handful of labor and inflation reports will set the tone for rate cut odds in the final stretch before the Sept 17th Fed decision. Softer labor and cooler inflation would support a cut, but the threat of re-emerging inflation still looms.
(Labor and Inflation Data to Watch) ⤵️
Thu Sept 4:
ADP (Payroll) jobs report
Jobless claims
Fri Sept 5:
August jobs report + unemployment rate + past month’s revisions
Wed Sept 10: Producer Price Index (PPI)
Thu Sept 11: Consumer Price Index (CPI)
Spotlight: PCE Inflation Recap (July) 🔦
The most recent Personal Consumption Expenditures (PCE) report was released on August 29th and showed that inflation remained above the Federal Reserve's target in July with a modest monthly increase, but met analyst expectations (ie limited market reaction).
Headline PCE: +0.2% MoM, +2.6% YoY (same as June, in line w/ expectations)
Core PCE: +0.3% MoM, +2.9% YoY (highest since February, in line)
What is PCE? The Personal Consumption Expenditures (PCE) price index measures the average change in prices for all the goods and services people buy, including things like food, housing, healthcare, and transportation.
Why is PCE the Fed’s preferred measure of inflation? The Fed likes the PCE price index over the Consumer Price Index (CPI) because it gives a fuller and more up-to-date picture of inflation. Unlike the CPI, which is based on a fixed set of goods, the PCE adjusts when people change their spending habits, like switching to cheaper options when prices go up. This makes the PCE a broader, smoother, and more realistic measure of inflation, which helps the Fed make better decisions about interest rates and the economy.
The RealTea đź«–
Last week brought a mix of signals. Mortgage rates ticked lower on softer bond yields and a dovish Fed outlook, but affordability and buyer sentiment remain deeply challenged. Nationally, the housing market is still constrained by supply and discouraged demand/buyer fatigue. Locally, Central Ohio continues to show strong listing activity coupled with persistent price reductions, even as raw showings remain higher than last year.
Major Themes/Headlines from Last Week
Slowing job growth: Softer payrolls, weaker revisions, and layoffs hint at a cooling labor market. Yields dropped, easing mortgage rates.
Fed considerations: Jackson Hole minutes revealed growing concern about housing and possible flexible inflation targeting.
Political noise: Trump’s pressure on the Fed stirred independence concerns, though markets shrugged it off for now.
Housing stagnation: Rate-lock effect and affordability crisis keep turnover muted despite rising inventory.
Tailwinds:
Softer bond yields and rate cut expectations are easing mortgage rates
Rising purchase applications show early signs of buyer re-engagement
Headwinds:
Affordability remains stretched, with high prices and wages not keeping pace
Showings per listing continue to decline sharply YoY
Widespread price reductions highlight buyer pushback on current pricing
TL ; DR đź“–
Macro
⬇️ 30-yr mortgage rates dipped to 6.51% average for the week
⬆️ Purchase apps rose 2.2% WoW and 24.3% YoY
⬇️ 10-yr Treasury yields eased after PCE inflation matched expectations
Central OH
Active inventory up ⬆️ 69.8% YoY (5,242 homes)
Median sales price ⬆️ 4.8% YoY at $349K
Showings per listing ⬇️ 33.1% YoY, though raw showings ⬆️ 13.6%
Macro Update đź“Š
Stock Market Performance Last Week
Dow Jones: 45,616 → 45,544 (flat, slightly lower)
S&P 500: 6,339 → 6,460 (up, hit record high midweek)
Nasdaq: 21,466 → 21,455 (down, pressured by tech selloff)
Drivers: PCE inflation in line with expectations, but still above Fed target. Profit-taking before Labor Day weekend and caution around Fed policy weighed on sentiment.
30-Yr Mortgage Rates (Mortgage News Daily)
Aug 25: 6.54%
Aug 26: 6.52%
Aug 27: 6.51%
Aug 28: 6.50%
Aug 29: 6.50%
Weekly Average: 6.51%
Mortgage Applications
⬆️ 2.2% WoW
⬆️ 24.3% YoY
Last 4 weeks: 158 → 160.2 → 160.3 → 163.8
Same period 2024: 149.9 → 149.5 → 142.0 → 144.9
Federal Reserve (CME FedWatch)
Sept 17 FOMC Meeting:
91.7% chance of 25 bps cut
8.3% chance of no cut
Oct 29 Meeting (assuming a Sept cut):
48.9% chance of no additional cut
47% chance of another 25 bps cut
Other Indicators
Fear & Greed Index: 62 (Greed)
Truflation Inflation Index: 2.03%
Sentiment on X (Last 7 Days) 📢
Nationwide chatter remains dominated by affordability concerns. Buyers are discouraged, with many calling homeownership a “luxury.” Most expect rates will need to fall into the low-5% range before demand improves meaningfully. Sellers anticipate Fed cuts may push prices higher, but sentiment suggests disappointment may follow if affordability does not improve. Columbus sentiment mirrors national patterns, with no unique divergences.
Pull-quote: “Buying a home is now a luxury amid record prices and low demand.”
Central Ohio Market Update  🌎📍
Market Dynamics: A Seller’s Market shifting toward Buyer-friendly conditions.
The Central Ohio housing market continues to see elevated listing activity and expanding inventory, now nearly 70% higher than last year. Price reductions remain widespread, signaling ongoing affordability pressure, while showings per listing are trending down despite raw showing counts being higher than last year. The market is active but competitive, with buyers still sensitive to rates and pricing.
Stats from the Last 4 Weeks (08/03–08/30)
Closings: 2,403 ⬇️ 1.4% YoY
New Listings: 2,950 ⬆️ 24.4% YoY
Active Inventory: 5,242 ⬆️ 69.8% YoY, ⬇️ 1.7% WoW
Median Sales Price: $349,000 ⬆️ 4.8% YoY
DOM: 29 ⬆️ 38.1% YoY
Months of Supply: 2.2 (up from 1.3 LY)
% Price Reductions: 58.7% of actives
YTD Snapshot (Through 08/31/2025)
Closings: 18,802 ⬇️ 1.0% YoY
Median Sales Price: $339,725 ⬆️ 4.1% YoY
$/SF: $213.26 ⬆️ 2.9% YoY
LP/SP Ratio: 98.4% ⬇️ 0.3% YoY
New Listings: 23,479 ⬆️ 13.8% YoY
Showings & Affordability
Question: Where would rates need to be for Franklin County to have an Affordability Index of 100? 🤔
Answer: Assuming a median home price of $340,000 & a median income of $71,680, mortgage rates would need to be at 5.20% to achieve an Affordability Index of 100 - ie, a family with the median income can afford the mortgage payment on a median-priced home. The average weekly Affordability Index for 2025 in Franklin Co. is 90.7. As of June 2025, the National Affordability Index is 94.4 (Source: National Association of Realtors via FRED®).
Affordability Index: 88.4 → 86.7 → 89.8 → 84.2 (vs LY 93.0 → 86.5 → 95.6 → 91.2)
Showings per Listing: 4.7 → 4.3 → 4.3 → 4.2 (vs LY 6.7 → 7.0 → 6.5 → 6.3)
Raw Showings: 25,037 → 23,229 → 22,825 → 22,200 (vs LY 20,332 → 21,346 → 19,891 → 19,535)
Here’s the data:
All data pulled from Columbus REALTORS® Multiple Listing Service (MLS). Central OH is defined as Single-Family, Residential listings from the following Counties - Franklin, Delaware, Licking, Fairfield, Union, Pickaway, Madison, Morrow, Fayette, Athens, Champaign, Clark, Clinton, Hocking, Knox, Logan, Marion, Muskingum, Perry, Ross. Sales figures do not account for seller concessions/credits provided to buyers. Price reductions are defined as a reduction taken at any time during the lifespan of the listing.