Written by: Elizabeth Salas Evans, President & CCO at Cayena Capital Management; MFF Visiting Scholar
April 29, 2020
With the United States (U.S.) at about sixty thousand deaths, COVID-19 continues to havoc communities both near and far. As states across the U.S. reopen for business, many are left grappling for clarity on how this will impact their respective communities, shining a spotlight on mayors and town officials, with the largest spotlight on marginalized communities, who stand to be the hardest hit from this pandemic. The Mortgage Bankers Association (MBA) printed a decline of negative three-point three percent on mortgage loan applications from one week prior, with the refinance index declining seven percent from last week, and purchases rebounding a bit, up twelve percent in the same period; purchases are down twenty percent from this time last year. Gross Domestic Product (GDP) in the U.S. contracted by an annualized rate of four-point eight percent in the first quarter of the year. The graph reflects Real GDP from April 1947 to March 2020, with the grey shaded areas indicating U.S. recessions. Hot off the press, the Federal Reserve through its Federal Open Market Committee (FOMC) has decided to maintain the target range for the federal funds rate at zero to one quarter of a percent, with Chairman Powell’s reassurance to sustain rates low for the short to medium term, until the U.S. economy is back to full employment. The Federal Reserve will hold their next scheduled meeting in June. All eyes will now turn to tomorrow’s Jobless Claims, with estimates showing three and half million claims, which would bring the total number of Americans out of work to approximately thirty million.