I hope you had a nice, long holiday weekend and got to enjoy some summer fun and festivity!
As we get the week rolling, markets continue to digest Friday’s Jobs Report where we saw a much more robust than expected number for new job creation. Payrolls rose 850,000 in June, above the consensus of 703,000. The unemployment rate edged up to 5.9 percent from 5.8 percent, above the 5.6 percent expected. Amid reports of worker shortages and reluctance to go back to work, the participation rate remained unchanged at 61.6 percent, just below the expected 61.7 percent.
As for mortgage rates, the most recent survey of average rates put out by Freddie Mac revealed a slight improvement in rates for the 30-year and 15-year fixed. Home sales continue to be hampered by low inventory issues across the country.
As for this week…
This week looks to be a quiet one for economic data. The most important release will likely be the latest Fed Meeting Minutes that will come out on Wednesday afternoon. Traders will be looking for the Fed’s latest sentiments and plans around its current bond buying program; the one that’s stimulating the bond market and helping keep mortgage rates low.
As I’ve mentioned in the past, the Fed’s program of bond buying could be nearing some changes in policy. Usually when the Fed Members meet in Jackson Hole, Wyoming in August major policy issues are discussed so many Fed-watchers are anticipating the Fed’s bond-buying to be a topic of discussion as we see inflation rising and the economy recovering.
With the job market fresh on our minds, the latest report on new claims for unemployment will be interesting to see. The expectation is that claims will continue to improve as we see more Americans returning to work.
As for housing data, we have no data due out this week but last week the Case-Shiller report on home price appreciation showed price data beat the consensus forecasts, at a 1.6 percent monthly gain in April for a 14.9 percent year-over-year gain.
Also, Pending Home Sales figures beat expectations as a leading indicator to coming home sales numbers. Predictions were for a -0.8 percent pull-back in homes going under contract when in fact the actuals showed an 8 percent rise in pending sales.
Remember, with housing appreciating and mortgage rates remaining so low, it’s an ideal time to refinance out of Mortgage Insurance (PMI). If you are currently paying PMI, reply to this email or call/text me and we can set up a time to go over your specific scenario.