April 5th, 2024 2:36 PM by T. Fanning
Hello, I hope you’re having a great Friday!
The latest jobs data revealed a surge in new job creation beyond expectations. However, the unemployment rate and wages remained in line with forecasts. While there’s room for debate about the specifics of these new jobs and their impact on economic improvement, the overall effect on interest rates is neutral. Fortunately, rates haven’t been significantly harmed, ending the week with a smaller increase than one would expect. Next week, we anticipate the publication of several critical economic reports, with a particular focus on inflation indicators. Alongside these data releases, we can expect additional Federal Reserve speeches, two Treasury auctions, and the minutes from the previous month’s Federal Open Market Committee (FOMC) meeting. These events collectively have the potential to significantly impact interest rates.
We offer Conventional, FHA, VA, USDA, Jumbo and regular construction financing. Some of our niches include: Chenoa Fund loans (100% FHA financing); Conventional, FHA and VA 1x Close Construction-Perm; 1.50% Down FHA Advantage Program; CHFA Financing; HomeStyle renovation program; and a Jumbo, 5% down program. We can also do non-traditional programs! To see a detailed list of programs, visit our website: www.homeloanmortgageco.com/mortgageprograms
Last Updated: 4/5/24
Friday's bond market has opened in in negative territory following unfavorable news about the labor market. Stocks are reacting positively to the stronger data, pushing the Dow up 100 points and the Nasdaq up 142 points. The bond market is currently down 13/32 (4.36%) but gains very late in the day yesterday should limit this morning's increase in mortgage rates to approximately .125 of a discount point. Most lenders did not improve pricing before Thursday's close. If you did see an intraday revision, you should see a larger increase this morning.
Today's major economic news was the release of March's Employment report at 8:30 AM ET. It revealed 303,000 new jobs were added to the economy during the month, greatly exceeding forecasts of 200,000. The U.S. unemployment rate slipped from February's 3.9% to 3.8%. The stronger payroll number and the fact the unemployment rate moved lower makes the report bad news for bonds and mortgage rates.
The third headline reading we follow is average hourly earnings that showed no surprises. February's 0.1% increase in earnings was changed to up 0.2%, but March's 0.3% monthly and 4.1% year-over-year increases were widely expected. It is mostly the payroll number causing this morning's bond selling with the lower unemployment rate a distant second. The earnings reading hasn't had an impact.
Next week brings us the release of a handful of economic reports, including two highly important inflation readings. In addition to the data and more Fed speeches, there are two Treasury auctions and the minutes from last month's FOMC meeting that also have the potential to cause a noticeable move in rates. The week starts light with nothing of relevance scheduled for Monday, leaving the most important events for midweek. Look for details on all of next week's activities in Sunday evening's weekly preview.
If I were considering financing/refinancing a home, I would....
Lock if my closing were taking place within 7 days... Lock if my closing were taking place between 8 and 20 days... Lock if my closing were taking place between 21 and 60 days... Float if my closing were taking place over 60 days from now...
This is only my opinion of what I would do if I was financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.*
*https://www.homeloanmortgageco.com/DailyRateLockAdvisory
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