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It was a fairly quiet week in the U.S. economy as the Thanksgiving holiday limited data releases last week. Existing trends continued from the prior week as the 10-year treasury continued to drift lower. The yield on the 10-year is now 4.42%, nearly 60 basis points below its recent peak in mid-October.

Is the monetary tightening cycle over? Has the Fed orchestrated the illusive soft landing for our economy, reducing inflation to a sustainable level without sending the nation into recession? The answers to these questions are still yet to be fully determined, however last week’s lower inflation report provides further evidence that future interest rate increases me not be needed.

The 10-year treasury is down about 35 basis points from its recent high in mid-October as signs of slowing fundamentals in the economy continue to arise. Mortgage rates have also fallen in recent weeks, prompting a slight uptick in demand for mortgages. The recent drop in mortgage rates may bring some renters back into the buyer pool, cutting into multifamily performance, however, I expect this to impact apartment demand only marginally.

October employment growth was weaker than it had been in previous months with new job gains totaling 150,000. August and September gains were revised down, painting a slightly more bleak picture of the employment market than we have seen in recent months. As a result, the 10-year treasury retreated quickly, although it remains high at 4.6%.

U.S. economic growth is gaining momentum following a very strong initial estimate of Q3 GDP. The broad measure of economic output showed the economy expanding at a 4.9% annual rate, more than double the growth rate from the first half of the year. Despite higher interest rates throughout the quarter, the American consumer continued to spend.