Mortgage rates for May 02, 2019 are in a holding patter a day before the Employment report. Sometimes the Employment report changes the direction of mortgage rates so generally speaking lenders are a bit conservative heading into the report. That being said; if you are purchasing a home and still need to lock in your interest rate then you really should do so before the Employment Report. Taking a chance on rates moving lower post report is risky and you have a short time line.
FHA Mortgage Rates
Jumbo Mortgage Rates
Mortgage Backed Securities and Treasury Snapshot:
Mortgage Backed Security FNMA 4.0 started the day at 102.58, and FNMA 3.5 was at 100.86. The 10y Treasury yield opened the day at the 2.51% level. The 10y yield continues to trade in the 2.50% to 2.55% level which is good news for the market and consumer mortgage. While the Treasury market does not set mortgage rates it does have an influence over the Mortgage Backed Securities market (which is where consumer mortgage rates originate).
Economic Data This Week:
Today we have we have the weekly unemployment report, ISM-New York Index and Factory Orders report. To finish off the week we have the BLS Employment report and ISM-Non Manufacturing report.
Weekly Unemployment Report:
Expectations were for a reading of 215,000 unemployment claims however the actual reading came in at 230,000 claims (which is the same as last week).
Unless we see reports showing an increase and that increase moved beyond 250-275k claims; the weekly report probably will have little to no impact on the bond market or mortgage rates.
ISM-New York Index and Factory Orders:
The reading came in at 882.8; which was above expectations (869.1). The Factory Orders report also came in higher than expectations (0.8 vs 0.3).
Labor Costs for Q1 2019 sank dramatically. The report came in at -0.9% while expectations were for a 1.5% increase. Q4 2018 reading came in at 2.00%.
This is a small part of the overall inflation picture. This is a dramatic decrease in Labor Costs and overall a positive for bonds and mortgage rates. Low Labor Costs helps with keeping inflation low and that is what bonds and mortgage lenders are focused on. Low inflation generally means lower mortgage rates.
Employment Report and Mortgage Rates:
Every month we have the Employment report. Some reports move mortgage rates; others don’t.
Tomorrow’s expectations are as follows:
- 185,000 jobs created
- Average earnings increase 0.3%
- Unemployment rate of 3.8%
The Earnings reading receives very little news coverage however for mortgage rates its very important. Higher than expected earnings is inflationary which is bad for mortgage rates. If we see earnings come in at 0.0% or lower that might end up being a positive for mortgage rates moving forward.
As for job creation; it’s unlikely to disappoint considering the strong ADP Employment report (yesterday).
JB Mortgage Capital, Inc.:
We offer industry low mortgage rates for both refinance and purchase transactions, personal one-on-one service and we have an A+ rating with the Better Business Bureau (BBB). We also have a top rating with the Business Consumers Alliance (AAA). We utilize the latest technology to ensure a fast closing and Loan Officer Kevin O’Connor has over 14 years of experience as a mortgage professional.
When it comes to mortgage rates please keep in mind that mortgage rates adjust daily; sometimes they adjust multiple times in a day when the bond market is volatile. Also things like obtaining cash out, lower credit scores, higher Loan-To-Value ratios, rental properties and the subordination of a second mortgage will cause in an increase in your mortgage rate. To obtain the most up-to-date quote, specific to your loan scenario be sure to contact Loan Officer Kevin O’Connor at 1-800-550-5538 or you can submit a “Contact Us” request on the our website.