Mortgage rates ended the week unchanged, after economic releases last week continue to show a tight labor market and inflationary pressures.

The November Consumer Price Index had a year-over-year increase of 6.8%, reaching its highest level since 1982. Consumer sentiment is improving, driven partly by expectations for wage increases. The Federal Reserve announced today it will double the pace of scaling back its purchase of Treasuries and mortgage-backed securities and begin to raise rates once the taper is complete. Projections now show three rate increases of 0.25% each in the next year, giving the Federal Reserve more flexibility to counter inflationary pressures and price increases going forward.

Looking toward the new year, markets will continue to focus on supply chain issues, labor market challenges and inflation measures to assess where rates will go from here.