The escalating conflict in Iran continued to dominate headlines and financial markets this week. Brent crude oil surged past $120 per barrel by March 9 — a staggering 65 percent increase from pre-conflict levels — as the Strait of Hormuz remained effectively closed to commercial shipping. The 30-year fixed mortgage rate jumped 11 basis points to 6.11 percent, erasing most of February's gains in a single week.
Inflation Data: Calm Before the Storm
The February Consumer Price Index, released on March 11, showed inflation rising 2.4 percent year over year with a 0.3 percent monthly increase. Core CPI came in at 2.5 percent annually. Those numbers were largely in line with expectations and reflect the economy before the oil shock hit. Shelter costs rose 0.2 percent, food increased 0.4 percent, and energy ticked up 0.6 percent for the month.
Analysts are already flagging that the March CPI will tell a very different story. Gas prices are surging nationwide — California has already broken above $5 per gallon — and the pass-through effects of higher energy costs will likely push inflation readings meaningfully higher in the coming months.
Housing Market Holding — For Now
Existing home sales came in at a seasonally adjusted annual rate of 4.09 million in February, recovering 1.7 percent from January. The median sales price was $398,000 nationally, with 3.8 months of supply on the market. But those numbers reflect activity that occurred before the conflict began. The real test will be how buyer behavior shifts in March and April as rates climb and economic uncertainty rises.
What This Means for Central Utah
Energy costs hit rural communities harder than urban centers, and Central Utah is no exception. Longer commutes, reliance on propane and natural gas heating, and a service-based economy all mean our residents feel the squeeze more directly when oil prices spike. For home buyers, the math has shifted — higher gas costs and rising rates both eat into monthly budgets.
However, Central Utah's affordability advantage becomes even more important in times like these. A median home price in the mid-$300,000s versus the statewide average of over $535,000 means buyers here still have significantly lower monthly obligations, providing a buffer against rising costs elsewhere. If you are comparing markets, communities like Richfield, Monroe, and Manti offer value that is hard to find along the Wasatch Front.
The Week Ahead
The Federal Reserve meets next week, and all eyes will be on how Chair Powell addresses the dual challenge of a slowing labor market and rising energy-driven inflation. The decision — and the updated economic projections — could set the tone for mortgage rates through the spring.