Sellers should expedite their moving plans…..

The big monthly jobs report is something that typically matters a great deal to rates.

Oddly enough, today’s jobs report was NOT seen having much of an impact for a few reasons.  First off, analysts expected a much weaker number due to Omicron’s likely impact.  Moreover, the Fed is almost exclusively focused on inflation right now as opposed to the labor market (employment and prices are the 2 key parts of the Fed’s job description).  In short, no matter what today’s jobs numbers turned out to be, they weren’t likely to impact the market’s view of the Fed’s reaction.

All of that is now out the window, sort of.  Although there are several important caveats regarding major seasonal adjustments, the jobs numbers were so much higher than the average forecast that markets were forced to respond.  Fed rate hike expectations increased briskly and bond yields surged to their highest levels in more than 2 years.

If we disregard the once-in-a-lifetime volatility seen in March 2020 (and we absolutely should), today’s mortgage rates are now in line with the highs seen in October 2019.  The average lender is now quoting conventional 30yr fixed rates in the 3.75-3.875% neighborhood.  That’s a full eighth of a point higher than yesterday, and more than a full percentage point higher than the lowest rates in August 2021.  Many less than perfect loan scenarios will see rates over 4%.


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