OIL: Analysts Revise Up 2025 Crude Price Forecast: Reuters Poll

The Spanish GDP deflator softened notably in Q4, with the flash release indicating growth of 2.3% Y/Y (vs 3.3% in Q3). Unit labour cost growth was strong at 4.0% Y/Y (vs 3.6% prior). However, this was offset by a 2.0% Y/Y fall in unit profits (vs growth of 2.6% prior). 

• Unit labour costs contributed 1.9pp to annual deflator growth, while unit profits subtracted 0.8pp. Unit taxes and subsidies contributed the remaining 1.2pp.
• Looking a little closer at unit labour costs, compensation growth was strong at 7.6% Y/Y (vs 7.2% prior). While this was partially offset by an acceleration in hours worked (2.8% Y/Y vs 1.4% prior), real productivity per hour worked softened to 0.7% Y/Y (vs 2.1% prior).
• Information on the GDP deflator and labour productivity will not be available for other major Eurozone countries (or the region as a whole) until the final releases in late February/early March. The ECB expects moderating wage growth to ease labour cost pressures in 2025, while productivity growth is forecast to pickup owing to "the cyclical adjustment of the economy over the projection horizon and a slowdown in employment growth". 

• MBA composite mortgage applications dipped 2% last week (sa) after a flat week that consolidated a previous 33% jump at the start of the year.
• The latest decline was driven by refis (-6.8% after -2.9%) whilst new purchase applications only inched lower (-0.4% after 0.6%).
• New purchase applications stand at 63% of 2019 averages for some of their highest levels since mid-2023 vs just 30% for refis.
• The recent moves came as the regular 30Y mortgage rate held steady at 7.02%, broadly consolidating its recent rise to 7.09% for highs since Mar 2024. 

• MNI: US MBA: MARKET COMPOSITE -2.0% SA THRU JAN 24 WK