Weak jobs data, Syria air strikes keep mortgage rates down
Strong lock opportunity for buyers as rates drop to 2017 lows
Friday’s U.S. Labor Department jobs report for March came up well short of analysts’ expectations, indicating a correction after the “Trump bump” and warm-weather construction boom in January and February.
The country’s employers added 98,000 new jobs in March, far below the consensus prediction of 180,000. However, the unemployment rate dropped from 4.7% to 4.5%, average hourly earnings were up 0.2% and the new jobs data may have been skewed by adverse weather that impacted reporting. Despite the poor showing in labor numbers, most experts feel that the Fed’s plan to increase interest rates multiple times in 2017 will remain unaffected.
Mortgage rates, which had been falling steadily for three weeks on the tail of long-term Treasury yields, touched their yearly low as the jobs report and U.S. airstrikes in Syria contributed to a jittery investment landscape. The 30-year fixed rate mortgage was averaging 4.10%, down 20 basis points from mid-March. Over the same time period, the 15-year fixed rate mortgage fell from 3.50% to 3.36%, and the 5/1 ARM dropped from 3.28% to 3.19%.*
With military action overseas and an economy that has clearly come back from its post-election honeymoon, investors may stay somewhat conservative in the short term. This could hold treasury yields and mortgage rates in a relative holding pattern until the Fed makes its next move. Before another big decision from Chairwoman Janet Yellen and company, prospective homebuyers and those looking to refinance can take advantage of this unique set of circumstances by locking in a low rate today!