Friday's Job's Numbers Will Set the Track for Rates

Last week saw a break out to the upside for mortgage rates after hitting their lowest point since last year. The exact reason is hard to pin point of course but a couple of the factors that contributed to the jump in rates.

Greek Bailout-Once again Greece is looking for money from the EU to bail them out so they can make their debt payments. They passed an unfavorable austerity program that the other countries were looking for so they would be will to give them the cash flow. I'm sure they will stumble again but at least there is a new band-aid. There is fear this will spread to Portugal and Italy but the bleeding has slowed for now

The End of QE2-The fed ended their controversial quantatative easing program, at least for now. It ended the fed buying mortgage backed securities to help free up liquidity and keep rates low. I'm sure round 3 will come eventually, but we are off the government Cool-aid for now.

Better Data- We finally hit a good string of regional and national manufacturing data. After some poor reports there was some good news that led to the best week in the equities market in 3 yrs.

Friday the jobs report for June is released at 830 AM and the market is hoping for a better report than last month.

Nonfarm Payrolls - M/M change 54,000  110,000  63,000  to 160,000 
Unemployment Rate - Level 9.1 % 9.1 % 9.0 % to 9.2 %
Average Hourly Earnings - M/M change 0.3 % 0.2 % 0.1 % to 0.2 %
Av Workweek - All Employees 34.4 hrs 34.4 hrs 34.4 hrs to 34.4 hrs
Private Payrolls - M/M change 83,000  125,000  100,000  to 183,000 

I'm convinced we will never be under 7% again nor do we have to be to be an economic power house. This recession taught companies how to be more profitable with less over head and more investment in technology. If this is the case it means a long drought for the housing market but hopefully I'm wrong.

The mortgage rates will react up or down on Friday depending on the report so those with floating rates pay close attention.

 

John B. Saari


 

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5 Comments on Friday's Job's Numbers Will Set the Track for Rates

JUL
06
2011
172,109 Points

I think the numbers will come in bad, between government poking their nose in this business and a lack of jobs Real Estate could be miserable for a long time for some.

But we have to stay positive and make the best with what we got.

 
8:16pm • #1
261,927 Points 56 Featured Posts Outside Blog Called Shot Master

I think the government is in "fudge up" mode so it wouldn't shock me to see the number come in higher than the 54k estimated (only to be adjusted downward in next months report). This means rates will climb.  Hope I'm wrong!
8:57pm • #2
430,990 Points 23 Featured Posts Outside Blog Called Shot Master

John...great information.  I look forward to reading your mortgage rate reports!
9:45pm • #3
JUL
07
2011
891,152 Points Outside Blog Called Shot Master

John - You are right. Friday's job's number will have an impact on interest rates. Thanks for the information.
12:13am • #4
698,864 Points 22 Featured Posts Localism Sponsor Outside Blog Attended Rain Camp Called Shot Master

Thanks for the information and analysis John, we shall see what the numbers tell us tomorrow.
6:40am • #5


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John Saari "The Mortgage Buddy"

John Saari "The Mortgage Buddy"

Worcester, MA

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I decided to start writing this blog to be an education resource to my referral partners and my clients. We live in a new world of mortgage lending in which we need to be up to date on the changing underwriting guidlines and mortgage products offered. It's through these updates that we will all be able to provide our clients with the customer service they derserve and expect. It's my belief that this industry insight is what will take our business to the next level. Education = Confidence


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