Sunday, May 5, 2013

Mortgage Rates Jump Higher Following Employment Report

Mortgage rates shot higher at their fastest pace in two months after this morning's hotly anticipated Employment Situation Report showed that job creation in April was better than expected. Stronger economic data tends to cause longer term interest rates to move higher. In addition to April's relative strength, the report also revised March's abysmal job creation of 88k payrolls up to more palatable 138k. This likely exacerbated the resulting weakness in bond markets as the March numbers (released on April 5th) were a big factor in the past month of improvements in mortgage rates. The average conventional 30yr Fixed rate for an ideal scenario had been edging down to 3.375%, and while that remains viable today, the average once again centers on 3.5%.

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