In a letter to leaders of the House Financial Services Committee, the Structured Finance Association (SFA) was joined by other leading financial services industry groups in announcing support for the Adjustable Interest Rate (LIBOR) Act of 2021, which the committee is scheduled to vote on today.
In an interview with the Wall Street Journal, Federal Reserve’s James Bullard expressed he is ready to start scaling back purchasing of bonds---specifically mortgage-backed securities--- once other top central bank officials have reached a consensus
On July 13, the U.S. Labor Department released its latest Consumer Price Index Report which shows prices jumped by 5.4% over the last 12 months. This is the largest year-over-year gain since 2008. The increase in consumer demand in areas like used cars, hotel stays, and air travel coupled with supply chain deficiencies are factors attributed to the spike in inflation.
Bloomberg reports sales of new bonds backed by commercial real estate are soaring to levels not seen in years even as sectors like hotels and malls face a long road to recovery from the pandemic. According to Moody’s Investors Service, loan delinquencies are expected remain “disproportionately high” for certain commercial mortgage-backed securities (CMBS).
The Wall Street Journal reports that Federal Reserve officials are debating reducing purchases of mortgage-backed securities. The Fed has bought $982 billion of mortgage bonds since March 2020, and currently plans to keep buying at least $40 billion each month.
On June 28, the Consumer Financial Protection Bureau (CFPB) finalized a new rule that requires loan servicers to establish three main safeguards to protect borrowers against avoidable foreclosure.
On June 22, Federal Reserve Chair Jerome Powell spoke before the House Select Subcommittee on the Coronavirus Crisis. Powell highlighted how the U.S. economy continues to show “sustained improvement” from the impact of the pandemic and job market gains.
The American Banker reports that the Biden Administration is expected to provide $1.25 billion in funding for community development financial institutions (CDFIs). These are private financial institutions whose primary objective is to support community development by providing financing to low-income communities.
The New York Times reports that amid the pandemic and a shift to work from home, many Americans are departing cities for the suburbs. Over the past year, new home construction in small cities and suburban areas rose 15%, compared to less than 10% in big cities. U.S. builders are on track to start construction on 1.1 million single-family homes this year, the most since 2006.
Fitch Ratings reports that the decline in worldwide travel due to the pandemic has extended recovery trajectories for aircraft ABS asset values. The reduction in market values is tied to the surge in parked and out of service passenger aircrafts given the 90% drop in domestic and international air travel in 2020.
